Five groups are competing for stakes in the two airlines owned by Mexican state holding company Cintra, Aeromexico and Mexicana, with the winners expected to be announced shortly.
The bidders include at least four Mexican consortia and Spain’s Globalia travel group, which includes Air Europa. Globalia expects to bid with one of the local groups to comply with Mexico’s 25% foreign cap. Bidders must offer to buy at least 51% of the government’s shares. If they do not buy 100%, Cintra is planning a public offering to sell the rest.
Aside from who the buyers will be, the other major question is whether the sale will generate the $700 million the Mexican government wants. Cintra’s share price has dropped nearly 30% since Iberia pulled out of the bidding in October, and its third-quarter consolidated net income is down more than 75% from a year ago.
Mexico’s Vector Financial Services lists the risks facing the airlines as heightened competition from low-cost carriers, higher fuel prices and the possibility of a slower Mexican economy.
Source: Airline Business
