Mexicans Press Ahead with IPOs

The market backdrop that has challenged bond issuers appears not to deter ECM hopefuls, at least in Mexico, with Grupo Lala moving to price a MXP13.0bn ($990m) IPO October 15, followed by Grupo Interacciones the next day for MXP4.0bn. Lala, the dairy and food products company, is offering 444m primary shares at MXP23.50-MXP27.50, meaning a MXP13.02bn deal at the midpoint if a 15% greenshoe is included. The base deal would result in a 19% free float, with the controllers’ holding going from 69% to 56% after the IPO. Lala is seeking funds to repay bank debt and for its growth plans, which include investments in its existing capacities as well as possible acquisitions in Mexico, Central America and “new geographies.” JPMorgan is global coordinator on the transaction, and is joined by Morgan Stanley and BBVA as bookrunners and Santander, Inbursa, Banorte-Ixe and Banamex as co-managers. Lala joins a growing lineup of issuers hoping to get a deal done this month with 2Q financials and ahead of any market uncertainty later this year and in 2014. Next up in Mexico are the IPOs of Grupo Hoetelero Santa Fe and Fibra Danhos, both scheduled to price Tuesday. Fibra Sendero is the only Mexican issuer with papers filed that hasn’t launched. This contrasts with Brazil, where several issuers have been looking for an October pricing, but so far only a follow-on from Tupy and an IPO from Ser Educacional have set a pricing date.