Background on Grupo México and its Relevance
Grupo México, a conglomerate led by Germán Larrea, has announced that it will not significantly increase its debt if its offer for Banamex is accepted. This assurance comes after a turbulent week in the Mexican stock market, where it dropped 15% following Grupo México’s Banamex acquisition announcement.
Financial Stability and Investment Projects
In a statement sent to the Mexican Stock Exchange (BMV), Grupo México explained that accepting their Banamex offer would not require a substantial debt increase for the company. They detailed that even if they were to acquire 100% of Banamex’s shares, the maximum credit they would need would be less than $2 billion. These funds are already secured through pre-arranged credit lines, according to the company.
Moreover, Grupo México emphasized its commitment to ongoing investment projects in mining, transportation, and infrastructure divisions, regardless of the Banamex acquisition.
“The company maintains a strong balance sheet, with net debt of only $375 million by the second quarter of 2025, equivalent to 0.1 times its EBITDA level,” the statement clarified. “This provides ample room for the acquisition and continued operations and investments across its three divisions without compromising financial stability.”
Ownership Structure of Banamex under Grupo México
Grupo México clarified that their offer for 100% of Banamex’s shares, announced on October 3rd, includes retaining 60% of the total investment value while inviting other Mexican private investors and AFORS (Voluntary Private Pension Funds) to acquire the remaining 40%.
Currently, Grupo México has agreements with Mexican investors to cover the remaining 40%, and they plan to later conduct a public offering to include small and medium-sized investors, “democratizing and providing liquidity to capital,” as stated.
Consultation Period with Citigroup
Grupo México also mentioned that they have set a 10-day period for Citigroup to consult with its Board of Directors and principal shareholders, considering regulatory authorities’ statements in the United States to fulfill their fiduciary responsibilities.
No Plans to Increase the Offer for 100% of Banamex Shares
Grupo México reiterated that they do not plan to increase their offer for 100% of Banamex shares, which currently exceeds Citigroup’s announced 25% offer.
The acquisition aims to retain Banamex’s entire management team and establish a specialized executive committee to prevent any distractions from the three divisions currently part of Grupo México.
Grupo México’s Track Record in Strategic Investments
Grupo México highlighted its experience in high-value, long-term business ventures with a focus on operational and financial discipline. Their successful acquisitions, such as Buenavista del Cobre, Ferromex, SPCC’s Peruvian mining assets, Asarco, and US short-line railway lines, have significantly contributed to the company’s positive performance.
Key Questions and Answers
- Q: Will Grupo México increase its debt if the Banamex offer is accepted? A: No, Grupo México has assured that they will not significantly increase their debt if the offer is accepted.
- Q: What percentage of Banamex will Grupo México retain? A: Grupo México will retain 60% of Banamex, while inviting other Mexican investors to acquire the remaining 40%.
- Q: How will Grupo México finance the Banamex acquisition? A: Grupo México has secured credit lines worth less than $2 billion to finance the acquisition, ensuring their financial stability.
- Q: What is Grupo México’s plan for Banamex’s management team? A: Grupo México intends to retain Banamex’s entire management team and establish a specialized executive committee.
- Q: Why is Grupo México confident in this acquisition? A: Grupo México’s track record in strategic, high-value investments with operational and financial discipline supports their confidence.
