By Amy Guthrie
MEXICO CITY--The Mexican unit of Sempra Energy (SRE) raised $521
million via an initial public offering on the Mexican Stock
Exchange Thursday, a source with direct knowledge of the deal told
Dow Jones Newswires.
The 189.7 million shares priced at 34 pesos ($2.74) each, at the
high end of the proposed MXN30-MXN34 range, the source said, amid
exceptionally strong demand both in and outside Mexico. Including
an overallotment option that is expected to be exercised, Sempra
Mexico would have raised around $600 million.
Investors were eager to buy shares in "the first public company
with pure energy exposure to Mexico," the source said. Excitement
was also fueled by expectations for Mexico to open up to greater
private sector energy investment, as well as recent contract wins
by Sempra Mexico, the source added. Investors can currently buy
bonds issued by Mexico's state-owned energy firms, but no shares
are on offer.
Sempra announced plans in October to build a $1 billion
natural-gas pipeline for Mexico's state-owned utility that will
connect pipelines in Arizona with power plants in western
Mexico.
Some of Mexico's largest pension funds bought into the Sempra
Mexico deal, as did Mexican retail investors and large
institutional funds. Dedicated emerging markets and Latin America
funds participated, while global funds that specialize in
infrastructure and energy also took part.
The Mexican units of Citigroup, BBVA, Credit Suisse and Deutsche
Bank led the deal.
In Mexico, San Diego, Ca.-based Sempra owns a natural-gas import
terminal in Baja California, a network of gas pipelines and a gas
utility, among other assets.
Sempra said it plans to use most of the proceeds from Thursday's
offering for general corporate purposes in Mexico.
The company's Mexican unit has been renamed Infraestructura
Energetica Nova, or IEnova. Sempra sold about 19% of the Mexican
unit via the IPO.
Mexican Stock Exchange Chief Executive Luis Tellez said earlier
Thursday that IEnova would be the last IPO during a busy quarter of
offerings on the local exchange.
In addition to pent up investment demand in Mexico's huge energy
sector, which is dominated by state-controlled firms such as
Petroleos Mexicanos, Mr. Tellez noted that investors in general are
optimistic about Mexico's economic prospects.
--Cassandra Sweet and Saabira Chaudhuri contributed to this
story
Write to Amy Guthrie at amy.guthrie@dowjones.com
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