Cuervo ‘delays IPO’ on election concerns
Mexican drinks group Jose Cuervo International has reportedly delayed its highly anticipated initial public offering due to market uncertainty surrounding the US presidential election.
According to a Reuters report, Jose Cuervo, the world’s largest Tequila producer, has postponed its planned IPO on the grounds of market volatility fuelled by the vote, which is set to take place on 8 November 2016.
It was expected that the IPO could raise as much as US$1 billion, funds which could be used for future brand acquisitions, earlier reports stated.
The upcoming election will see Democrat Hillary Clinton take on Republican Donald Trump, who has pledged to build a wall between the US and Mexico if he wins.
Despite Trump’s rhetoric, Tequila and mezcal sales continue to soar in the US. Between 2010 and 2015, the categories grew 30% by volume in the market, according to analyst Euromonitor – a rate faster than any other alcohol category bar Cognac, and ahead of the global average which sits at 22%.
Additionally, as interest in Mexican heritage grows, the Tequila and mezcal industry in the US is forecast to grow 17% between 2015 and 2020.
in 2014, Diageo and Jose Cuervo struck a deal which saw Cuervo acquire the Bushmills Irish whiskey brand in return for Diageo’s full ownership of Don Julio Tequila.