The Mexican government has rejected an offer by local construction firm ICA to buy the remaining 49% stake in airport operator Grupo Aeroportuario Centro Norte (GACN) for $270 million and will instead offer it for sale for $300 million via an IPO. ICA already owns 51% of the company and therefore had the right to bid for the outstanding shares. GACN has operations in 13 locations throughout the country, including Monterrey and the resort of Acapulco. In February the government raised $870 million from the sale of Grupo Aeroportuario del Pacifico (GAP), the country’s largest airport operator. The sale was the government’s largest IPO in 10 years.
Category: Regions
Posted inDaily Brief
Peru Decides
More than 16 million Peruvians went to the polls yesterday, Sunday, to decide their new leader for the next five years. They were also electing a new vice president and the 120 members of Congress. Early indications were that none of the front three candidates would secure the more than 50% of the vote needed to avoid a second-round run-off, with populist Ollanta Humala holding off conservative Lourdes Flores, polling 30.9% versus 24.5%, trailed by former president and social democrat Alan García on 23.3%. Despite having very different platforms, there was little to separate the votes of the three leading candidates to become Peru’s new president: and with 25% of the electorate undecided before polling day, surprises are possible. A second-round of voting is slated for 7 May. The new president takes office on 28 July, Peru’s Independence Day.
Posted inDaily Brief
Bidders Line Up For Ecopetrol Project
Meanwhile, eight bidders have qualified to bid for the license to explore and develop 1.7 million hectares in the Colombian province of Meta for unproven oil reserves of around 3 billion barrels together with state-owned oil firm Ecopetrol. The government is looking for investment commitment of around $1.6 billion that it estimates will increase daily production from its current level of 60,000 barrels of crude up to 200,000 barrels. Bidders include Exxon Mobil and Chevron of the US, France’s Total, Brazilian Petrobras, BP of the UK, Russian Lukoil, Spain’s Repsol YPF and China Petroleum and Chemical Corp.
Posted inDaily Brief
Telefónica Outbids CANTV For Colombia Telecom
Spain’s Telefónica has beaten off rival bidder CANTV of Venezuela to win control of Colombia Telecom for $369 million. Telefónica outbid its Venezuelan rival by $17 million to buy 50% plus one share of Colombia’s largest state-owned telephone company, exceeding government expectations of a $350 million sale price. The government is holding on to almost half the company to ensure the privatization does not lead to the creation of a private quasi monopoly as it did in many Latin American countries, most notably Mexico. The sale has thwarted attempts by Mexican entrepreneur Carlos Slim to gain a foothold in Colombia’s telecoms market. Last year a bid by his Telmex of $350 million was rejected by the government as too low. Two weeks ago he bought 29% of CANTV in what was seen as a move to secure control of the Colombian provider. Citicorp advised the government on the privatization.
Posted inDaily Brief
Peru Elections Too Close To Call
The leading candidates in Peru’s presidential elections on Sunday are neck and neck in the lead-up to polling date. Conservative Lourdes Flores, the front-runner until last month, has recaptured the lead from populist Ollanta Humala, according to one recent poll. The CPI poll, published Thursday, gave Flores 26.7% of the vote ahead of Humala on 25.9% and former president Alan García on 24.9%. However, with around 25% of the electorate undecided going into election day, the outcome of Sunday’s polls is anything but clear.
Posted inDaily Brief
Mexico’s Pemex to Invest Almost US$2 Bln in Refineries
Petroleos Mexicanos, Mexico’s state-owned oil monopoly, plans to invest almost US$2 billion in its refinery system this year to improve safety conditions at its plants following a series of high-profile accidents. Years of under-investment have left the company’s plants in poor condition. Efficiency improvements will also help the company lessen its growing reliance on imports of gasoline and other refined products.
Posted inDaily Brief
IDB Meetings End With No Debt Relief Agreement
The annual meeting of the Inter-American Development Bank ended with no agreement on debt relief for the region’s poorest countries. Haiti, Bolivia, Honduras, Nicaragua and Guyana had hoped the bank would agree to forgive as much as US$3.5 billion in debt, arguing they cannot afford the payments without cutting back on desperately needed social programs. Bolivia owes US$1.6 billion and Honduras another US$1.4 billion.
Posted inDaily Brief
Bolivia Pressing LAB Airline Chief to Quit
The Bolivian government is negotiating with the majority owner of Lloyd Aereo Boliviano to give up his stake in the airline as it seeks to head off staff protests. Ernesto Asbun may give up his share in the debt-ridden company to workers who have not been paid for three months. It is not clear the workers will agree to the conditions and whether this will be enough to save the country’s largest airline, which is sagging under US$160 million in debt.
Posted inDaily Brief
Mexican Stocks Hit Record High
The Mexican stock market index reached its highest level ever, driven up by mining companies enjoying soaring metals prices and America Movil, which today bought Verizon Communications Inc.’s Latin American assets. The index rose 2% to 19,634.21. The stock market has risen recently thanks to a buoyant economy, fueled by consumer spending, high oil prices for its exports and low interest rates.
Posted inDaily Brief
Vitro Sells Subsidiary for $103 Million
Grupo Vitro SA, Mexico’s largest glassmaker, sold a 51 percent stake in Vitrocrisa to its U.S. partner Libbey Inc. for $103 million to pay down debt. At the end of 2005 the company had debt of US$1.38 billion and has been shopping assets in a bid to avoid default. The Mexican glass market has become increasingly competitive with the arrival of foreign companies.