Mexico in Brief
From Mexico in Brief Newsletter
A MILLIONAIRE FINANCING FOR USED CAR SALES IN MEXICO.
Kavak, a Mexican used-car startup, has secured financing from HSBC of approximately U.S.$675 million, which is added to other recent credit lines agreed with Goldman Sachs and Santander for approximately U.S.$135 million. The funds will be mainly used for backing the company’s car loan offerings. The bank intends to buy collection rights for a set of the company’s used car loans, then formalize a form of a forward flow agreement. The funding will also be used to lower barriers to accessing car loans for the Mexican population.
LIVERPOOL: DIVERSIFYING & INVESTING.
One of Mexico’s largest department store companies, Liverpool, announced that it will invest approximately U.S.$295 million to acquire 9.9% of the shares of U.S.-based department store chain, Nordstrom. This is targeted to diversify its assets geographically since Nordstrom has a wide reach in the United States and Canada, where it operates more than 350 units, as well as an internet platform and digital sales. Last year, Nordstrom generated revenues of approximately U.S.$14.8 billion.
A NEW PLANT FOR THE BOSCH GROUP.
The German multinational engineering and technology company, Bosch Group, announced that it will construct an approximately U.S.$215 million plant in the Mexican state of Queretaro. The 425,080 square feet plant will manufacture components for mobile applications designed for machinery. The company has plans of making several other investments in Mexico for approximately U.S.$750 million, to expand plants in the Mexican Central states of Queretaro and Aguascalientes, as well as Nuevo Leon.
A MULTI-MILLION-DOLLAR BUYOUT.
A unit of Mexico-based conglomerate Grupo Mexico has agreed to buy Planigrupo Latam for approximately U.S.$0.71 per share, an offer of approximately U.S.$236 million. Planigrupo Latam is mainly responsible for the development, acquisition, and administration of shopping centers and has a market value of approximately U.S. $270 million.
COMING SOON: THE GROWTH OF STARBUCKS.
Mexican restaurant operator and developer, Alsea, which has the Mexico franchise to develop Starbucks, announced an investment of approximately U.S.$225 million over the next 4 years to continue growing the multinational coffeehouse’ chain. With this investment, it seeks to open more than 200 new stores in the country by 2026, which will be added to the 753 that the company currently operates in Mexican territory.
GROWTH & INVESTMENT IN THE MEXICAN ENERGY SECTOR.
The Mexican government has announced that approximately U.S.$10 billion will be injected as an investment in the infrastructure sector. Canada-based New Fortress Energy will invest approximately U.S.$3 billion in two natural gas liquifying facilities. Similarly, also Canada-based TC Energy will build a new pipeline in the Mexican state of Veracruz, making an investment of approximately U.S.$5 billion in the process. Additionally, France-based Engie has announced an investment of approximately U.S.$1.5 billion to extend the Cuxtal II pipeline in the Mexican Southeast.
NEW OPPORTUNITIES FOR MEXICAN INVESTMENT.
Around 30 international companies, mostly Chinese, are gearing up to make a cumulative investment of approximately U.S.$1 billion in the region near the Mexican states of Jalisco, Guanajuato, and Queretaro, mainly in the automotive sector. Given that Mexico often maintains a neutral position in international political conflicts, investors have seen Mexico as a safe and stable environment in an increasingly turbulent global landscape.
DEACERO’S MAYOR EXPANSION IN MEXICO.
Mexican conglomerate, Deacero, will make an investment of approximately U.S.$600 million in 2022 to expand its operations in Mexico and reach its 2024 sustainability goals. Fifty percent of the investment will go to purchasing new machinery and equipment, increasing its capacity by 1 million tons annually, To 4.5 million tons. The other half will go to research and innovation.
KIA INCREASES INVESTMENT IN NUEVO LEON.
Korea’s largest automobile manufacturer, Kia, will invest approximately U.S.$408 million in its plant in the Mexican state of Nuevo Leon. From this amount, approximately U.S.$67 million has already been funded for improvements and adjustments in infrastructure, and five new industrial buildings will be built with the remaining funds, generating approximately 800 new job positions. Since its initial investment in 2016, Kia has invested approximately U.S.$3 billion in its plant in Nuevo Leon.