Vitro May Sell Container Business Generating 48% of SalesBrendan Case
Vitro SAB said Chairman Adrian Sada Gonzalez and his son, Chief Executive Officer Adrian Sada Cueva, bought a 9.9 percent stake as Mexico’s largest glassmaker weighs the sale of its biggest unit by revenue.
The Sadas each acquired almost 24.1 million shares, Vitro said today. The purchases bolster the family’s stake in Vitro 17 months after the company settled a legal duel with U.S. creditors, including billionaire hedge fund manager Paul Singer, over claims from its 2009 default.
Vitro disclosed the possible sale of the food-and-drink business yesterday, saying a potential buyer is conducting due diligence and negotiating a price, while declining to name the suitor. A divestiture of most of the container manufacturing would mark Vitro’s first major sale of a business in at least three years, according to data compiled by Bloomberg.
“We’re willing to explore any operation that may represent benefits for our shareholders and other interested parties,” Sada Cueva said in the statement.
Vitro rose 3.5 percent to 37.10 pesos at the close in Mexico City. The San Pedro Garza Garcia, Mexico-based company didn’t identify the sellers in the transaction involving its top executives. Fintech Advisory Inc., a hedge fund founded by David Martinez, got a 20 percent stake last year after acting as Vitro’s financial partner in the accord with creditors.
Sada Gonzalez held a 6.6 percent stake in Vitro as of April 2013, according to data compiled by Bloomberg.
The company said it remains optimistic about the food-and-drink segment’s outlook. The container business that Vitro might sell generated 49 percent of its $355 million in 2013 earnings before interest, taxes, depreciation and amortization, it said.
The sale would include operations in the U.S. and Bolivia as well as Mexico, while excluding businesses such as cosmetics-container manufacturing and Vitro’s car-windshield and construction-glass units.
The company also said yesterday that it signed a seven-year, $950 million contract to supply 7.3 billion beer bottles to Constellation Brands Inc., which owns a brewery making Corona beer in Piedras Negras, Mexico.
The glassmaker will invest $100 million to build a new furnace at a plant in Monterrey, Mexico, during the next 18 months to fill the contract, while using other Mexican factories to supply Constellation in the meantime.
In addition, Vitro will invest $90 million to build a Brazil plant that will make containers for cosmetics and perfumes, it said yesterday.