Tag Archives: Luis Doporto Alejandre México

Capítulo 6: If these companies became successful with the Stock Exchange, why wouldn´t yours?

Destacada con los logos de FAcebook, Palacio de Hierro, PR1ME Capital, José Cuervo

By: Ximena Peinado  

You probably read the title and thought: “because others earn more than mine?”. But, guess what? This is not an obstacle or an excuse at all. Companies like Amazon or Facebook achieved their success by selling their shares on the stock market .

We know that the case of Google and the other two companies mentioned could be considered an exception for the innovations they offered to the market. However, this is not a matter of luck

The stock market in Mexico

The case of José Cuervo is the most accurate. In February 2017, the largest tequila producer in the world raised more than 18 billion pesos in one week by placing its shares on the Mexican Stock Exchange.

The company initially placed 548.1 million shares, of which 172 thousand 126 million were acquired by Mexicans and the rest, 375 thousand 979 million by foreigners.

Their success was a consequence of the over demand in their stocks. The guidance they received from two of the most known brokerage houses: Morgan Stanley and JP Morgan.

Graphic becle price behavior jose cuervo PR1ME Capital Capítulo 6: If these companies became successful with the Stock Exchange, why wouldn´t yours?
Eduardo Garza

A company that started with a small bakery in Mexico City called El Molino in the center of Mexico City. Bimbo was founded officially in 1945 in the capital of Mexico; the next year the company expanded to Puebla; in the 50s they opened their factory in Guadalajara and Monterrey.

The next big step Bimbo made was when in 1980 they made their company go public and sold their stocks. At first, they sold 15% of their company. Its value then multiplied and its international expansion started in the US in 1998. Then came Brazil in 2001 and Spain and Portugal in 2011. 

Palacio de Hierro was  one of the pioneers in the Mexican Stock Exchange, to which it was registered in 1990. This company, which belongs to  to Alberto Baillère, nowadays amounts to more than 18 billion dollars.

As a last example, we have BeGrand, a company focused on the transformation of the urban contour and whose main objective is to develop comfortable, quality coexistence spaces in harmony with the environment.

BeGrand is a company that has used the different instruments of the Mexican Stock Exchange in its favor. In February 2018, the company obtained a loan for 1.5 billion pesos over 3 years, with which it could pay previously acquired credits. In the same year, in the month of August, they returned to the market with a Certificate of Development Capital (CKD) with which they obtained four billion pesos to continue their projects.

Entrepreneurs and investors

In addition to this, not only do the companies themselves benefit from this, and the opportunity for profit does not end with just selling shares. An entrepreneur or an investor can also increase the value of his person both physically and morally through the purchase of shares. Men who serve as a clear example are Carlos Slim, Roberto Hernández and Alfredo Harp.

Carlos Slim began investing in the stock market in 1982 and in 1984 he created the Inbursa brokerage house and became one of the largest investors in the BMV. Slim, who belongs to one of the richest men in the world, decided to invest in times of crisis in stocks.

Today, his companies concentrate about 40 percent of the BMV’s main index and his personal wealth, according to Bloomber, is up to $ 68 billion.

Roberto Hernández and his partner, Alfredo Harp, also took advantage of the stock market boom. In 1971 the two founded Actions and Values ​​(Accival by its acronym in Spanish). Through this institution, they led many Mexican companies to list on the stock market.

One of them was Grupo México, the conglomerate of mining and transport companies whose owner is Germán Larrea, another investor benefited by the stock market boom and privatizations. Roberto Hernández and Alfredo Harp, in addition to maintaining a relevant position in Citigroup, the global corporate from Banamex, have shares in many BMV companies, in addition to being part of a large part of some of the boards of directors of these.

Stock Market Instruments

As it has already been proven, the instruments of the Mexican Stock Exchange can potentiate both the growth of your company and your own income as an investor. These previous examples are only a few of the many that exist in our country, and globally speaking, they are only a small fraction of the total number of success stories that exist.

It is important to note that this process is not easy and must be done carefully, especially in legal matters. Therefore, in the next chapter we will detail the necessary legal framework that a company on the stock market needs.

Keep learning from PR1ME Capital

We have already talked about  how the Mexican financial system works , in addition to telling you everything you  need to know about listing . In addition to telling you   what the origins of the bag are .

We talked about that listing on the stock market can be in many ways, and we share with you some tools to achieve it .

Continue reading our new series on financial exchanges so you can learn from  PR1ME Capital .

Source: El Financiero, Expansión, Dinero en Imagen, Bolsa Mexicana de Valores

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Chapter 5: How could you finance your company with the Mexican Stock Exchange?

Destacada del Capítulo 5 ¿Cuáles son los instrumentos que tienes para financiarte con la bolsa. PR1ME Capital Luis Doporto Alejandre | ¿How could you finance your company with the Mexican Stock Exchange?

By: Ximena Peinado

In the last chapter, we talked about the necessary steps that must be taken to be able to list your company on the stock market. Once you have met all the requirements, it is time for you to think about what kind of instruments available are adapted to the finance needs of your company.

Next, we present the four instruments of the Mexican Stock Market that you can use. Any of these is effective, the only thing that changes is the objective of where the money that you collect with your shares or, better said, your public offering that you will put on the stock market.

Short Term Debt

They are useful to cover the needs of working capital.

Short Term Debt PR1ME Capital PR1ME Capital Chapter 5: How could you finance your company with the Mexican Stock Exchange?
Short Term Debt, Eduardo Garza

Long Term Debt

The Long-Term Debt is designed to cover the financing needs for infrastructure, expansion, refinancing of liabilities and other corporate purposes. For this, it is necessary to carry out a securitization of assets, which, through a trust, allocate assets or flows of future cash to obtain financing to give liquidity to non liquid assets.

Long Term Debt Doporto PR1ME Capital PR1ME Capital Chapter 5: How could you finance your company with the Mexican Stock Exchange?
Long Term Debt, Eduardo Garza

Shares

Capital finance through the issuance and public offering of shares is the most competitive formula for obtaining long-term resources for the company. When the company wants to gather resources without increasing its liabilities and obtain fresh capital, the best alternative for it is the issuance of shares, which will increase its Social Capital based on its growth and expansion strategies. The return for the investor in this case is presented in two ways: in the dividends generated by the company and the capital gain.

Shares Doporto PR1ME Capital PR1ME Capital Chapter 5: How could you finance your company with the Mexican Stock Exchange?
Shares, Eduardo Garza

Real Estate Investment Trusts

REIT are vehicles destined to the finance for the acquisition or construction of real estate that has as its purpose the lease or the acquisition of the right to receive the income from the lease of said goods. By law, the Trusts distribute 95% of the profits from the rents among the investors holding the Real Estate Investment Trusts.

REIT Doporto PR1ME Capital PR1ME Capital Chapter 5: How could you finance your company with the Mexican Stock Exchange?
Real Estate Investment Trusts, Eduardo Garza

Development Capital Market

The “CKD’es” are securities that will issue trusts, which will support the channeling of investment resources to growing sectors and activities and will provide flexibility and new alternatives for portfolio diversification to Institutional and Qualified Investors in our country.

They are defined as titles or fiduciary securities destined for the finance of one or more projects, or for the acquisition of one or more companies. Their performance is tied to the underlying assets or assets in trust. These are designed to drive infrastructure, real estate, private equity and technology development projects.

Development Capital Market Doporto PR1ME Capital PR1ME Capital Chapter 5: How could you finance your company with the Mexican Stock Exchange?
Development Capital Market, Eduardo Garza

The process is long, but it has its advantages. Throughout history, there have been several success stories in companies that multiplied their value by listing. One of the biggest examples is s Apple, Microsoft, Yahoo, Amazon y Google. In the case of the Mexican Stock Exchange, one of its success stories is José Cuervo.

Keep learning from PR1ME Capital

We have already discussed  how the Mexican financial system works , in addition to telling you everything you  need to know about listing . In addition to telling you   what the origins of the bag are .

Listing on the stock exchange can be in many ways, and for this reason in the next chapter we will explain them to you so  that you as an entrepreneur determine what is best for your company .

In the next chapter, we will investigate the legal framework of the stock market, so that you master your rights and your obligations as an investor.

Continue reading our new series on financial exchanges so you can learn from PR1ME Capital .

Sources: Mexican Stock Exchange ,
London Stock Exchange , Expansión

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Chapter 4: How to list your company on the stock market?

cómo listar tu empresa en la bolsa de valores - Doporto PR1ME Capital - Luis Doporto Alejandre

By: Ximena Peinado

The steps and requirements you need to make your company public

The main stock exchanges in the world fully recommend listing a company on the stock exchange. Today we have several instruments to do it and it is worth it, since by making your company public you can increase its value, strengthen its financial structure, grant it financial recognition and quality standards, make finances and sources of capitalization more flexible, and in general, vastly improve your company’s image.

By listing a company on the stock exchange, it becomes more attractive both nationally and internationally, since its management would be institutional and thus the enterprise has the obligation to provide the information to the investing public in a completely transparent manner.

With the improvement of the financial structure come positive consequences such as the optimization of costs, the increase in profit margins, immediate liquidity, growth, the consolidation of liabilities, the possibility for research and development, sustainability and development of human capital.

In the same way, according to the Mexican Stock Exchange, the original shareholders can diversify their investment and with it their risk, increase their liquidity and obtain the flexibility to make decisions about their assets.

The New York Stock Exchange, one of the most weighty exchanges, agrees with the benefits and encourages entrepreneurs to do so with the promise of maintaining a market model that mitigates execution risk and reduces price volatility by more than 30%.

Similarly, the London Stock Exchange has talked about the benefits of a company going public; Among the main ones, the broadening of the company’s shareholder base, the establishment of objective market value and the use of quoted shares as the acquisition currency stand out.

The process is complicated, but by following a series of specific steps, you can achieve it if your company is large enough. In the case of the Mexican Stock Exchange, the steps are the following:

First: does your company have these characteristics?

Among the requirements of the Mexican stock exchanges are: the availability of a history of operations for the last three years, the stockholders’ equity has to be above 20 million udis, the average profit in the last 3 years has to be positive, that the Securities subject to Public Offering represent 15% of the capital and  at least 10 million titles for the IPO and 200 shareholders.

It is necessary to take into account that if you want to maintain control of your company, the offer may not exceed 49% of the capital. In the case of Reit’s it is different, because they can surpass that amount without the technical committee losing its control. 

For a company to go public, it needs multidisciplinary teams to help it along the way, such as investment banking, which structures the company in the formal process of executing the IPO.

Large transnational companies that started in a university dormitory or at home (like Facebook and Apple) were encouraged by banks to access investor capital and grow in the market.

Preparation consists of having a series of documents ready that will be mentioned later. Among them are the financial statements, which type of shares are going to be included and the numbers with which that action will go to market.

Also, it is recommended that you master what makes your company unique to others: clarify the strategies used within it, its competitive advantages, its mission, its vision and its areas of opportunity.

Prepare your company in Corporate Governance:

It is necessary to implement a mechanism that regulates the relations between the shareholders, the directors and the administration of the company. This requires expert advice. If you do not have a Corporate Governance specialist in your company, contact the Mexican Stock Exchange. When implementing Corporate Governance, your company must have:

  • Legal Constitution of the Board of Directors.
  • Formality in its administrative and operational processes.
  • At least have an Independent Council.
  • Have a Support Committee (Audit and Corporate Practices).
Gobierno-corporativo-Cómo-listar-tu-empresa-en-la-bolsa-Doporto-PR1ME-Capital-Luis-Doporto-Alejandre-market-list-stock-exchange

Have a Placement Intermediary

A placement agent is the brokerage firm that signs the placement agreement with the issuer and is responsible for reviewing and analyzing the documentation and information related to the issuer’s business and activities, so that a value is registered and, when needed, the approval of their public offer, as well as carrying out the operations of placing these securities on the market.

Preferably, choose a brokerage firm that suits your company’s goals. In the Public Offering, the price is determined jointly by the issuer and the placement intermediary (brokerage house) based on market conditions and the company’s potential. In the secondary market, the price is determined by free supply and demand.

The price of the Stock Certificates, the total amount of their issue, the denomination, the nominal value, the term, the date of issue, registration and settlement, the due date, the applicable interest rate and the way to calculate it (if applicable), the periodicity of interest payments, among other characteristics, will also be determined by the Issuer and the Placement Intermediary.

Choose a Stock Rating Agency

A Stock Rating Agency measures the probability that an entity will meet its financial obligations. Issue ratings also measure the probability that the issuer will not pay the value of the issues at maturity and meet the scheduled interest payments.

Therefore, the ratings that these agencies use are one way to measure risk. Some elements included in the rating of companies include business risk (such as management performance or size criteria), financial risk (profitability, cash flow, financial flexibility) and global perspective (political risk, classification cycles, macroeconomic conditions).

Submit a Registration Request

The documentation on the application for registration and authorization of public offering are found in the “Application Formats” of the Mexican Stock Exchange.

Promotion and Sale of Securities

You must present your company to the key investor public, including the placement’s sales force and potential investors. The underwriter must distribute its securities and provide price stabilization, actively support buying and selling, and taking care of sponsorship resources, such as investor conferences and promotional presentations for non-negotiation purposes.

Maintenance of the Emission

Companies that wish to register their securities on the BMV list, must consider the following aspects for the maintenance of their issue: comply with the basic requirements and standards set forth in the current regulations of the CNBV and the Mexican Stock Exchange according to the type of instrument they wish to list.

Marketing stage

Then, the action enters a marketing stage, where it is formally sold.

Traded stock

The final stage is traded the stock, a demand book is built, a price is reached and the placement is closed.

Do not forget that there are certain aspects that must be taken care of so that the issue remains in the bag. According to the guidelines of the Mexican Stock Exchange, a company must have at least 100 shareholders, 12% of the Paid Share Capital among investors, have an analysis coverage and a market maker.

As we can see, the listing process is very detailed because only companies that have a good organization and visualization of the objectives are allowed to enter. Not only will the process help you to have a clear vision of the trajectory of your company, but it will also give you the possibility of multiplying the value of your company.

Keep learning from PR1ME Capital

We have already discussed how the Mexican financial system works , in addition to telling you everything you need to know about listing . Do not miss our next installment and keep learning with PR1ME Capital.

We also already told you what the origins of the bag are. Listing on the stock exchange can be in many ways, and for this reason in the next chapter we will explain them to you so that you as an entrepreneur determine what is best for your company. Keep reading to us at PR1ME Capital and stay tuned for the next chapter.

 Source: Bolsa Mexicana de Valores, Alto Nivel

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Pr1me Capital’s Founding Partner, Luis Doporto Alejandre, Awards Student Winners to Support Mexican Avocado Projects

Luis Doporto Alejandre entrega premio del Primer Gran Reto Agroindustria

Students who extracted cellulose from an avocado win the First Great Agro-industry Challenge Pr1me Capital 2019 Award

Pr1me Capital Award Ceremony

​Doporto Pr1me Capital, an investment banking advisory boutique, has honored students for their development of new ways of transforming avocado residue.

​Doporto Pr1me Capital will finance the finalist projects to formalize them as business plans, and the team members will be able to join in the implementation and execution, in addition to seeking patents to protect their commercialization.

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Green gold

Captura de pantalla 2019 07 15 a las 18.41.35 PR1ME Capital Green gold

According to data from the Association of Producers and Packers Exporters of Avocado of Mexico, for the Super Bowl 2018 approximately 300 million dollars were exported in avocados.

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#Aguacate

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