GAP Sale Raises $870 Million

Mexico successfully raised $870 million from its largest IPO in 10 years with the sale last Friday of the government’s 85% stake in Grupo Aeroportuario del Pacifico (GAP), the country’s largest airport operator. The Mexican government sold 29 million ADRs priced at $21 each and 124 million B shares in the local market at 22.03 pesos. The share price of ADRs on the first day of trading was up 35%, while the share price in the local market rose 34%. The government could eventually garner up to $1 billion from the sale if underwriters exercise a greenshoe option to sell additional ADRs and B shares within the next 30 days. Air travel is expected to explode this year in Mexico following the entry of two low-cost carriers and the imminent arrival of two more.