Grupo México launches takeover bid to delist GMXT

Shares of Grupo México Transportes (GMXT), the rail transport division of Germán Larrea's Grupo México conglomerate, rose sharply on Tuesday on the Mexican Stock Exchange (BMV).

The push came after the company launched a freely floating public tender offer (OPA) for its shares, a necessary step toward completing its delisting from the stock market.

GMXT shares closed up 7.48% at 35.35 pesos. This is their highest level since June 3.

With this result, the company's shares have seen their largest increase since December 1, 2022, when they climbed 8.50 percent.

This year, GMXT shares have risen 8.56 percent. In terms of market capitalization, the company added 10.7 billion pesos, bringing its total to 154.4 billion pesos.

Puts an end to his story

The decision to delist will mark the end of Grupo México Transportes' short history on the Mexican Stock Exchange, as it only debuted on November 9, 2017. In fact, it was the last issuer to debut with an Initial Public Offering.

GMXT launched a takeover bid for up to 390.9 million shares, equivalent to 8.95% of its outstanding share capital, to cancel its registration with the National Securities Registry (RNV) and its listing on the Mexican Stock Exchange (BMV).

The price of 35.99 pesos per share offered a 9.4% premium compared to the stock market close on September 22.

The maximum amount to be disbursed is up to 14.068 billion pesos.

There are no incentives

Amín Vera, Finance Director of Invala Family Office, stated that Grupo México Transportes is seeking to delist from the Mexican Stock Exchange primarily because there isn't enough market volume in Mexico.

This lack of volume means that the costs of remaining a public company exceed the benefits that the stock market should theoretically offer.

"The core problem is that, due to the low volume in the Mexican market, listed companies are not receiving the benefits they should, such as access to financing at a lower cost and greater liquidity for their assets," he said.

However, despite not receiving these benefits, they do have to bear the significant costs of being listed. "These costs include filing quarterly financial information, maintaining credit ratings, paying auditors, and maintaining a market maker, which is extremely expensive," Vera explained.

GBM Research analysts confirmed that "GMXT announced the launch of its public offering to cancel the listing of its shares on the Mexican Stock Exchange (BMV). The offering will be valid from September 23 to October 20 (20 business days) and will be executed directly by the issuer."

The objective is to acquire up to 8.945% of the share capital (approximately 14.068 billion pesos), corresponding to the current float.

"If fully completed, Grupo México and Grupo Carso would retain stakes of 82.7% and 17.3%, respectively," they emphasized.