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World’s largest tequila maker puts IPO on ice

Hitting the rocks.

José Cuervo, the world’s largest tequila maker, has put its planned IPO for up to $1bn on ice because of market uncertainty in the wake of the US elections, according to people familiar with the plans.

The company, officially known as Becle, had filed its prospectus with the Mexican stock exchange in September.

But the Mexican IPC index has fallen nearly 7 per cent since Donald Trump’s shock election victory amid concerns that he may implement protectionist campaign pledges, including renegotiating or scrapping the North American Free Trade Agreement.

“There’s no appetite for Mexican assets at this time. Maybe next year,” said one person with knowledge of the matter at a bank involved in the deal.

Another person at another bank involved in the placement confirmed the issue was on hold and had no details of when it could be reactivated. A spokesman for José Cuervo declined to comment.

José Cuervo’s long-rumoured listing plans have hit the rocks four years after Diageo, the world’s biggest spirits group, gave up on plans to buy it.

The company, a rare independent for its size in a drinks sector dominated by conglomerates, has been making tequila, a liquor distilled from the native agave plant, since the 1700s when Spain still ruled Mexico.

The company said in its listing prospectus that it would use the IPO proceeds to boost growth, either organically or through acquisitions.

It has 27.4 per cent of the US tequila market and 32.6 per cent of the market in Mexico, it said in its filing. First-half sales were up by a third, to 12.2bn pesos ($588m), and 2015 net profits doubled to 7.2bn pesos.

In addition to its tequila, the company owns Kraken rum and Bushmills whiskey.

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