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UPDATE 1-Family behind Mexico's Homex shrinks stake to meet margin calls
May 7, 2013 / 10:51 PM / 5 years ago

UPDATE 1-Family behind Mexico's Homex shrinks stake to meet margin calls

MEXICO CITY, May 7 (Reuters) - The family that holds a large stake in Mexican homebuilder Homex has been selling shares to meet margin calls on loans, according to a U.S. regulatory filing.

Homex has been struggling amid slowing sales of its out-of-town homes, after it took on heavy debt to build large suburban developments that have fallen out of favor with Mexican homebuyers.

The De Nicolas family’s stake in the company shrank to 22.57 percent on May 3 from 27.53 percent last month, according to a filing with the U.S. Securities and Exchange Commission.

Five members of the De Nicolas family, including the chief executive and president of Homex, have sold 16,631,300 shares since April 26 via a trust, according to the filing.

The family sold the shares on five separate days “due to a margin call related to loans disposed initially during October 2007 and 2008,” the filing said.

The first sale of shares came on April 26, according to the filing. That was the day after the company reported a sharp drop in first-quarter profit and revenue.

A spokeswoman for Homex said the company had no information or comment about the family’s share sale.

The family trust also sold 3.16 million of its U.S.-listed shares earlier in April, a separate filing last month showed.

The total value of the shares sold between April 15 and May 3 was $34 million.

Between the moment the de Nicolas family first started dumping stock in mid-April and through May 3rd, Homex’s U.S.-listed stock has fallen 32.9 percent.

Homex U.S.-listed stock closed at $5.40 per share on Tuesday, while the Mexico-listed stock was up 2.37 percent at 10.82 pesos.

At the end of 2011, the De Nicolas family owned 34.1 percent of Homex shares.

Last month, the company said it would delay filing its annual report with regulators this year because it is restating results for 2011 and 2012 under international accounting standards.

Homex’s larger rival, Geo, is seeking to reach an agreement with its local debt holders after failing to make a payment due in April.

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