What is an IPO?
An IPO is a process by which a company goes public through the offering of new shares.
For this, companies must comply with several parameters of financial transparency and corporate governance, as well as with the current regulation issued by the Ministry of Finance and Public Credit.
With an IPO, a company can obtain new capital from the general public, who, by acquiring their shares, become ‘owners’ of a percentage of the company.
How does an Initial Public Offering work?
There are several ways to carry out an IPO, however, the most common is for a company to hire an investment bank to survey the market and assess the ‘appetite’ that exists among investors for a part of its shares.
Subsequently, the investment bank determines an exit sale price for the shares, that is, the initial value that those who want to take over a part of the company will have to pay.
The bank also evaluates the exit date and the appropriate stock exchange to carry out the operation.
What’s next for Banamex?
After not finding a buyer, Citibanamex will be divided into two: Citi México will run corporate, investment and private banking, while Banamex will maintain the business of credit cards, retail banking, consumer credit, mortgages, insurance, pensions, Afore , deposits and an offer of business products.
Once the two banks exist, they will operate as separate companies and the IPO will be prepared, which is expected to take place in 2025.
The process for the IPO takes about a year because it involves various regulatory requirements.