Shareholders in Mexican conglomerate Alfa approve spin-off of chemical subsidiary Alpek
Updates throughout with additional details
MEXICO CITY, Oct 24 (Reuters) -Shareholders of Mexican conglomerate Alfa ALFAA.MX approved the spin-off of its petrochemical subsidiary Alpek ALPEKA.MX on Thursday, a long-awaited move aimed at shoring up Alfa's finances after being weighed down by market swings hitting Alpek.
Alpek will now become known as Controladora Alpek, Alfa said in a filing, taking a cue from Alfa's former telecommunications unit Axtel, which was spun off into Controladora Axtel CTAXTELA.MX.
Controladora Alpek will also be listed on Mexico's main stock exchange, Alfa said, and shareholders in Alfa will receive one share in Controladora Alpek for each Alfa share they hold.
Shares in Alfa closed at 14.55 pesos ($0.74) on Thursday before the announcement.
The spin-off, exchange listing and share distribution should be carried out next year, Alfa said.
Alfa executives had long complained of the firm being weighed down by a so-called "conglomerate discount," in which the firm as a whole was valued at less than its parts.
Before spinning off Alpek and Axtel, Alfa also spun off automotive parts maker Nemak NEMAKA.MX.
"This separation allows each business to be valued by the market on the basis of its merits and individual potential," Alfa said.
Alfa will now focus in on its food subsidiary Sigma, it said.
"The advantages of the food industry, the positioning of Sigma's brands in all of the regions it serves and its constant growth are some of the bases which will allow (Alfa) to reach a higher valuation," the firm said.
($1 = 19.7930 Mexican pesos)
Reporting by Aida Pelaez-Fernandez and Kylie Madry; Editing by Brendan O'Boyle and Jamie Freed
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