Exhibition of several bottles of tequila being sold in the souvenir shop of Casa Jose Cuervo in Tequila, Jalisco.
Photograph by Hugo Ortuño Suárez — Getty Images
By Reuters
February 9, 2017

The initial public offering for tequila maker Jose Cuervo priced at the top of the expected range at 34 pesos per share, two people said on Wednesday, marking the first Mexican IPO since Donald Trump won the U.S. presidency.

The offer was more than eight times oversubscribed, the sources, who spoke on condition of anonymity, said.

The pricing of the 476.6 million share offer means the company raised at least 16.2 billion pesos ($791 million).

Combined with a 15% “overallotment option”, that could allow the company to rake in upwards of $900 million.

Jose Cuervo, the world’s biggest and oldest continuously producing tequila maker, did not respond to requests for comment.

The company, officially known as Becle, put its IPO on hold twice last year, as Trump’s march to the White House gathered strength, sending the peso currency to a series of record lows.

Trump has threatened to slap a hefty tax on products Mexico sends to the United States to pay for a border wall, as well as tear up a joint trade deal with Mexico.

U.S. protectionist measures against Mexico could hurt Jose Cuervo, which generates 64% of its $1.165 billion in sales from American and Canadian consumers.

But investors have expressed strong interest in the IPO, citing Cuervo’s strong dollar-based earnings and saying demand for tequila is not heavily dependent on prices.

Started by Jose Antonio de Cuervo in 1758 before Mexican independence from Spain, Cuervo says it is North America’s oldest continuous producer of spirits.

Boasting 30% of the global tequila market, the business is now controlled by the Beckmann family, which will remain the majority shareholder after the IPO.

Aranda, a subsidiary of Singapore state investor Temasek Holdings, has said it will take a 20% stake in the listing, helping to put a floor under the IPO.

The price range was between 30 to 34 pesos.

Shares of the company should begin trading on Mexico’s bourse on Thursday.

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