Bachoco is about to join the group of companies that have decided to leave the Mexican Stock Exchange (BMV). The Robinson Bours family, which is in charge of Bachoco and Megacable, recently revealed its intention to make an offer to buy the shares of the company that produces eggs and meat that are in the hands of the investing public, in order to later delist them from the stock market. in Mexico and the United States.
Bachoco debuted on the Mexican Stock Exchange (BMV) and the New York Stock Exchange (NYSE) in September 1997. Until now, 73.25% of the company’s shares are owned by family members.
In a statement published on Friday, March 25, the Robinson Bours family explained that it would seek to acquire the 27% that it does not own, at an estimated price of 81.66 pesos per share, which reflects a 20% premium over the average listing value of the shares representing Bachoco’s capital stock on the BMV, for the last 30 days of listing.
Although the family did not make public the reason why it will seek to delist the company, for analysts the decision is due to the low valuation of the company’s papers in recent years. The same reason that led companies like Lala, Bio Pappel or IEnova to leave the national stock market last year.
“I understand that their intention to delist has to do with the low valuation they perceive for their stock, as well as the little or no need to fund via capital issues in the near future, since given their financial position they could well use leverage via markets. of debt at an interesting cost without the need to be listed,” says Carlos Hermosillo, an independent stock market analyst.
The company’s share price in the national stock market reacted to Friday’s announcement and closed the day on March 28 with an advance of 16.55%, at 77.11 pesos per paper. However, in the last five years the price for each title has accumulated a drop of 8.7%.
Bachoco’s financial situation
Bachoco was founded in 1952 in Sonora by brothers Javier, Enrique and Alfonso Robinson Bours Almada. Today it is the leader in the poultry industry in Mexico and the sixth largest producer of chicken worldwide, according to data from its profile on the Mexican Stock Exchange.
The company has more than 1,000 facilities organized in nine production complexes in Mexico and one production complex in the United States. Bachoco generates more than 29,000 direct jobs and has a market value of 46,266 million pesos.
At the end of 2021, the company’s revenues grew 18.8%, to 81,699 million pesos; while net profit rose 24.5%, to 4,945 million pesos. The cost of sales totaled 68,147.9 million pesos, 18.1% more than the 57,707.6 million reported in 2020.
Capital investments for 2021 totaled 3,500 million pesos, compared to 2,752 million in 2020. The resources were allocated to organic growth and productivity projects in the company’s plants. In addition, the total debt was 1,924.0 million pesos, 29% less compared to 2020.
“Bachoco is a company that has cleaned up its debt very well, it maintains a good level of leverage and this makes it attractive,” says Julián Fernández, head of stock market analysis at Bursamérica. “But despite the fact that it is a financially stable and strong company, its shares have not been valued in the stock market,” he adds.
For this year the company has noticed some challenges due to the rise in the cost of raw materials as a result of the advance of inflation that is experienced worldwide.
