Cintra is moving ahead with plans for the separate but simultaneous sales of both Aeromexico and Mexicana, concentrating on private placements.
The government agencies that own two-thirds of Cintra began an offer for separate stakes in the Aeromexico group, consisting of Aeromexico and Aerolitoral, and the Mexicana group, comprising Mexicana and its new low-cost subsidiary. Mexico’s government is willing to sell between 51% and 100% of its holdings in each airline group to separate buyers.
Cintra is encouraging local investors to form consortia, which may include airline employees, to bid for these stakes. It is not inviting offers from foreign investors but they may join locally-controlled investor groups so long as they keep within Mexico’s 25% foreign ownership cap.
The holding company aims to complete these placements by year-end. If the government’s entire stake in both airline groups is not sold by then, Cintra will continue to hold the rest. How long it might stay on as a minority shareholder in the airlines is unclear but Cintra’s board is clear that the second phase will be to sell whatever remains through a public offering, if necessary and based on market conditions.
Cintra has not revealed how much the government expects to earn from these sales but analysts value Cintra at around $2 billion. Additional assets may be offered for sale later, including Cintra’s cargo unit (Aeromexpress), training unit (Alas de America), ground handling (SEAT), engine overhaul (ITR) and its stake in Sabre.
Mexico’s secretary of transport and its competition commission have approved this plan. The initial order for Cintra to split its airlines into separate ownerships came from the competition commission. Its chairman, Eduardo Pérez Motta, calls Cintra’s plan “pragmatic and realistic”. Credit Suisse First Boston is advising Cintra in the sale process.
Source: Airline Business
