The world’s oldest and continuously operating tequila maker Jose Cuervo is toasting to its successful transition from private company to publicly traded company, after Trumpnomic’s did not mar its public debut.
Early this month the company, that controls 30% of the tequila market, went public on the Mexican Stock Exchange (Bolsa Mexicana de Valores) in hopes of raising $700 million in an initial public offering (IPO). The IPO efforts were scuttled twice last year after candidate Donald Trump became President, a president that was decidedly not bullish on anything Mexican not even the people.
Trump’s election caused the peso to plummet, as his carnival barking barks included getting rid of the North American Free Trade Agreement and imposing high tariffs on Mexican imports to pay for a border wall. All bad news for any Mexican made products.
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The IPO actually raised $900 million and exceeded all expectations with a starting price of 34 pesos per share ($1.71) and Singapore’s Temasek Holdings took a pre-IPO 20% ownership position. The company operates out of Tequila, Mexico and is headquartered in Mexico City.
The tequila maker was started by Don Jose Antonio de Cuervo y Valdes in 1758 after being granted the first mescal producing license from King Ferdinand VI of Spain – when Mexico was under Spanish rule.
Trumpnomics cannot trump the fact that tequila sales have increased over 100% since 2002 with the U.S. alone consuming 40 million gallons.
The company is controlled by the descendants of Don Jose de Cuervo and is currently run by Juan Domingo Beckmann, an eleventh-generation family member. The family remains majority shareholders of the publicly traded company (CUERVO.MX) and billionaires. The company plans to fund growth and make Tequila, Mexico a tourist mecca much like Napa Valley, with its new source of funds.
This week the stock was trading at 33.51 pesos per share.
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