Saturday, September 21, 2019

Logo Central America Link

Mexico invests

Thursday, July 21, 2011


José Antonio Diego thinks that his company, El Puerto de Liverpool, is likely to earn about $30 million a year in Central America, thanks to a trend that revives an old one—Mexican investment in the region.

Diego is the chief financial officer of El Puerto de Liverpool, Mexico’s leading department-store chain, which last month raised a small stake in Regal Forest to 50 percent. Now it shares ownership with the powerful El Salvador-based Grupo Simán.

Regal Forest may not be a household name, but its business and brands are well-known in Central America and the Caribbean. The group has a 25 percent stake in furniture and domestic appliances retailers in the region, with stores that include La Curacao and Tropigas, as well as the Radio Shack franchise.

Diego describes Regal Forest as “an excellent operator, in a market segment that is really attractive”. For the time being, Liverpool has no plans to introduce any of its own formats in the region.
The amount of the acquisition has not been revealed. But the stake that Liverpool acquired was sold by Actis, the London-based private equity fund. Actis recently bought the electricity transmission business of Spain’s Gas Natural Fenosa in Guatemala for $345 million.

Like Liverpool, other Mexican investors have renewed interest in Central America. After a 6 percent slump in Mexico’s economy in 2009 -- the biggest drop in Latin America—much of the lost ground has been regained.

Now Mexican companies are advancing aggressively in their southern neighborhood. Those who are knocking on the door include representatives of Monterrey Gruma. Gruma, the world’s leading manufacturer of corn flour, tortillas and related products, aims to develop a major plant in Nicaragua, to add to about 90 others in the region, Mexico, the United States, Europe and Asia.