Mexican industrial real estate trust Fibra Next pulled its initial public offering in the local market after a last minute snag over its tax status undermined investor demand, people familiar with the matter said.
Local pension funds were unable to participate in the deal without the final tax paperwork, said the people, asking not to be named because the information isn’t public. The company decided to pull the deal for now and will seek to place the offer again once it has the proper tax paperwork, the people added.
A representative for Fibra Uno, as the parent trust is known, didn’t immediately respond to a request for comment.
Fibra Next said in a filing late on Tuesday that the tax benefits of being a real estate investment trust (REIT) would not apply until it receives officials’ approval. Bankers involved in the deal told Bloomberg News earlier there was no legal impediment for the offer to be priced, while adding that the final decision on whether to go ahead with the launch rested with the company.
Mexico’s Biggest IPO Since 2018 Hits Last Minute Tax Hurdle
The listing had sought to capitalize on investor interest in “nearshoring” — the trend where manufacturers are moving to Mexico to be closer to the US market. Mexican companies with a link to nearshoring that have been raising cash since the middle of last year included logistics and industrial property-focused Prologis Property Mexico SA and trucking company Grupo Traxion SAB.
The IPO was originally planned to raise as much as $1.5 billion, but was pared back after the firm struggled to drum up enough investor interest at the valuation it was seeking. The company is aiming to sell up to 277.8 million shares known as CBFIs in the offering at around 54 pesos each, according to a filing on Mexico’s stock exchange website.
While no big companies have listed shares in Mexico since late 2017, there has been a trickle of REITs. Fibra Next’s listing would have been the biggest IPO since the $1.6 billion listing in early 2018 of a real estate trust tied to an airport project that was canceled by President Andres Manuel Lopez Obrador.