Mexicans Ready to Kick off IPO Pipeline

Real estate plays Grupo Hotelero Santa Fe and Fibra Danhos are scheduled to price IPOs today targeting MXP4bn ($304m) and MXP6bn, respectively, as the October ECM issuance window gets underway. Hotel operator Santa Fe plans to sell 201m shares, if a 15% greenshoe is included, at MXP18.00-MXP22.00 each, meaning a MXP4.03bn size at the midpoint. The issuer expects 84% of the deal to consist of primary shares, and the remainder to be secondary shares sold by investors Nexxus Capital and Walton Street Capital. Santa Fe is raising funds to repay debt and for expansion. It expects a 49% free-float following the transaction, not counting the greenshoe, with 37.5% held by developer Grupo Chartwell, 8.3% by Nexxus and 5.3% by Walton Street. Barclays and JPMorgan are managing the international portion of the transaction, and BBVA and Santander the Mexican portion. Santa Fe operates 10 hotels in five Mexican states, including a mix of city and beach resort properties, under brands including Hilton, Hampton Inn, Hyatt and Krystal. Danhos, meanwhile, offers 200m shares at MXP26.00-MXP28.00 each, according to offering documents, meaning a MXP6.21bn sale at the midpoint if a 15% greenshoe is included. The transaction includes both Mexican and international tranches. The fund begins with four shopping centers, four office buildings and three mixed-use properties, all in Mexico City, and is raising money to expand them and to add to the portfolio. BBVA and Goldman Sachs are global coordinators on the transaction, with Evercore as structurer and domestic bookrunner and Banorte-Ixe and Inbursa as co-managers.