UPDATE 1-Miner Grupo Mexico eyes spinning off at least two firms

Tue Apr 30, 2013 6:38pm EDT

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By Gabriel Stargardter

MEXICO CITY, April 30 (Reuters) - Mexican miner and infrastructure company Grupo Mexico may split into three listed units to capitalize on economic reforms planned by the government, the company's chief financial officer said on Tuesday.

Traders and analysts have long speculated that the company, Mexico's largest domestic miner, might list its transport and infrastructure divisions to generate income and drive growth.

That talk was given fresh impetus by the new government's plan to open up state oil monopoly Pemex to foreign investment, and improve Mexico's transport infrastructure.

Now Grupo Mexico has admitted it is considering such a move.

"If you ask me, the endgame here might be to have three publicly listed divisions of Grupo Mexico," Daniel Muniz, the CFO, said in a conference call with investors. He did not give any specific timetable for such a move.

"The significant increase in our investment shows how positive we are about the growth outlook for Mexico, particularly the energy outlook and the exceptional opportunity that has arisen from the recent change in government," Muniz added.

Grupo Mexico, which reported a 15.4 percent decline in first-quarter profits last week, has discussed listing its fully owned subsidiary Americas Mining Corporation on the London or Toronto bourse, Muniz said.

He said that when it was ready, Grupo Mexico would likely list its transport division first, noting that an infrastructure division public offering "probably needs a little more work."

Grupo Mexico might look to list about 20 percent of its transport subsidiary ITM by the end of the year, said Fernando Bolanos, an analyst at the Monex brokerage in Mexico City.

The government's plans to build up the infrastructure network provides Grupo Mexico with an added incentive as it seeks to shield itself from falling metals prices.

"It makes perfect sense given the juncture we're at," said Gerardo Roman at the Actinver brokerage in Mexico City.

"Reforms, growth, the connection with the U.S., the improvement of the U.S. economy...there's a lack of new listings and an appetite for more," he said.

Some Mexican holding companies have recently sought to spin off their subsidiaries on the booming local bourse, boosted by a surge of foreign inflows. In February, billionaire Carlos Slim re-listed his retailer Sanborns generating just shy of $1 billion.

Grupo Mexico's share price closed up 0.98 percent at 43.46 pesos.

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