Shares of Grupo Financiero Santander Mexico rose in debut trading after parent bank Banco Santander sold a 25 percent stake.
The $4.1 bn IPO, carried out in a dual listing in Mexico and the US, is the biggest ever in Mexico. The ADRs of the Mexican unit of the Spanish bank ended their first day of trading at $12.91, an increase of 6 percent on the offer price of $12.18. The offer price valued Santander Mexico at $16.5 bn.
The IPO was the second largest in the US this year, after the problem-fraught $16 bn IPO of Facebook, and the third-largest in the world so far in 2012, after Japan Airlines captured the number two spot earlier this month with an IPO valued at $8.5 bn.
After the Facebook IPO was hit by a series of trading glitches, the Japan Airlines IPO was set back by widespread protests in China against Tokyo’s purchase of the Senkaku Islands, which are claimed by China, where they are known as the Diaoyu Islands.
Japan Airlines was forced to cut flights to and from China amid growing protests, coincidentally around the time of the IPO, and sparked a share-price loss of more than 10 percent in the company’s first week of post-IPO trading.
That makes the Santander Mexico IPO the largest problem-free IPO in the world this year. Its global coordinators include UBS, Bank of America, Deutsche Bank and Santander Investment Securities.
Of the 24.9 percent stake in Santander Mexico that was offered, 81 percent is in the form of ADRs listed on the NYSE and elsewhere outside Mexico, while the rest are listed in the country.
The IPO ‘marks a new era in the history of our bank in Mexico and strengthens our plans for expansion and development in this great country, which we will continue to support in its growth,’ Emilio Botín, chairman of Banco Santander, says in a release put out after the offering.
‘This transaction underlines the strength and flexibility of Grupo Santander’s model of subsidiaries that are autonomous in liquidity and capital. The IPO of our unit in Mexico is an important step in our strategy of having market listings for all our significant subsidiaries.’
