Jose Cuervo postpones IPO as Trump election roils Mexico -sources

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Nov 23 (Reuters) - Jose Cuervo, the world's biggest tequila producer, has put its initial public offering on hold following the U.S. presidential election of Donald Trump, which has weighed on Mexican stocks and currency, according to people familiar with the matter on Wednesday.

The valuation of many Mexican companies has been hit by Trump's surprise victory on Nov. 8, fueled by concern about the U.S. president-elect's campaign promises to renegotiate or scrap the North American Free Trade Agreement.

Jose Cuervo, known officially as Becle, had filed with the Mexican bourse in September for an IPO that sources had said could raise as much as $1 billion. It is not clear how long the delay will be, but one of the sources noted that if the IPO were to take place after February, the company would need to update its prospectus for investors with new earning figures, potentially causing more delays.

Jose Cuervo will reassess its IPO plans in January, when the impact of Trump's upcoming presidency may be easier to evaluate, according to the sources.

16 PHOTOS
Touching scenes from the US-Mexico border
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Touching scenes from the US-Mexico border

Martha Morales and Juan Manuel Gonzalez Camacho hug their grandaughter Aileen Gonalez and son Adrian Gonalez Morales as they are allowed to meet after a door is opened along the United States-Mexico Border wall during Opening the Door Of Hope/Abriendo La Puerta De La Esparana at Friendship Park in San Ysidro, California on Saturday, November 19, 2016.

(SANDY HUFFAKER/AFP/Getty Images)

U.S. Border patrol agents stand at an open gate on the fence along the Mexico border to allow Adrian Gonzalez-Morales and his daughter Aileen hug his parents Juan and Martha, as part of Universal Children's Day at the Border Field State Park, California, U.S., November 19, 2016.

(REUTERS/Mike Blake)

U.S. Border patrol agents stand at an open gate on the fence along the Mexico border to allow Luis Eduardo Hernandez-Bautista hug Ty'Jahnae Williams and his father Eduardo Hernandez (not in view), as part of Universal Children's Day at the Border Field State Park, California, U.S., November 19, 2016.

(REUTERS/Mike Blake)

Family members hug during a U.S. Border Patrol sponsored visit at the U.S.-Mexico border fence in Tijuana, Mexico, on Saturday, Nov. 19, 2016. The U.S. Border Patrol, in coordination with immigrant rights groups, opened the metal gate so that previously selected families could visit for several minutes.

(Photographer: David Maung/Bloomberg via Getty Images)

A woman in Friendship Park in San Diego, California, U.S. speaks with children across a fence separating Mexico and the United States, November 12, 2016. Picture taken from Tijuana, Mexico.

(REUTERS/Jorge Duenes)

U.S. Border patrol agents stand at an open gate on the fence along the Mexico border to allow Edith Hernandez and her daughter Yvette hug Maria Plata-Colin, as part of Universal Children's Day at Border Field State Park, California, U.S., November 19, 2016.

(REUTERS/Mike Blake)

People in Friendship Park in San Diego, California, U.S. are seen behind a fence separating Mexico and the United States, November 12, 2016. Picture taken from Tijuana, Mexico.

(REUTERS/Jorge Duenes)

Relatives separated by immigration hug at an open gate on the fence along the Mexico and U.S border on Universal Children's Day in Tijuana, Mexico November 19, 2016.

(REUTERS/Jorge Duenes)

Relatives separated by immigration hug at an open gate on the fence along the Mexico and U.S border on Universal Children's Day in Tijuana, Mexico November 19, 2016.

(REUTERS/Jorge Duenes)

Luis Hernandez hugs his Father Eduardo as they are allowed to meet after a door is opened along the United States - Mexico Border wall during Opening the Door Of Hope / Abriendo La Puerta De La Esparana at Friendship Park in San Ysidro, California on Saturday, November 19, 2016.

(SANDY HUFFAKER/AFP/Getty Images)

Members of the Gonzalez family hug each other and react as they encounter at the gate of the U.S.- Mexico border fence opened for a few minutes on November 19, 2016 in Playas de Tijuana, Mexico. The door opening was organized by pro-migrants NGOs and local authorities in coordination with the United States Border Patrol.

(GUILLERMO ARIAS/AFP/Getty Images)

Relatives separated by immigration hug at an open gate on the fence along the Mexico and U.S border on Universal Children's Day in Tijuana, Mexico November 19, 2016.

(REUTERS/Jorge Duenes)

A U.S. Border patrol agent stands at an open gate on the fence along the Mexico border to allow Laura Avila and her daughter Laura Vera Martinez hug Maria Socorro Martinez Lopez, as part of Universal Children's Day at the Border Field State Park, California, U.S., November 19, 2016.

(REUTERS/Mike Blake)

A young boy joins his family members as they hug during a U.S. Border Patrol sponsored visit at the U.S.-Mexico border fence in Tijuana, Mexico, on Saturday, Nov. 19, 2016. The U.S. Border Patrol, in coordination with immigrant rights groups, opened the metal gate so that previously selected families could visit for several minutes.

(Photographer: David Maung/Bloomberg via Getty Images)

Relatives separated by immigration hug at an open gate on the fence along the Mexico and U.S border on Universal Children's Day in Tijuana, Mexico November 19, 2016.

(REUTERS/Jorge Duenes)

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The sources asked not to be identified because the deliberations are confidential. Cristobal Mariscal, general counsel and corporate affairs director for Jose Cuervo, declined to comment.

Jose Cuervo had been waiting for the U.S. presidential election to launch its IPO, hoping volatility on the Mexican Stock Exchange would subside. Instead, the market became more choppy. The Mexico IPC stock index has lost more than 7 percent of its value since the U.S. election.

"A big part of the uncertainty that is reflected in economic variables has to do with the great uncertainty about the economic policies that will be taken by the new administration in the United States," Mexican Central Bank Deputy Governor Manuel Sanchez said in an interview with Reuters this week about the future of the Mexican central policy.

In its IPO filing with regulators, Jose Cuervo warned the U.S. election could lead to renegotiation of trade deals, which could have a serious impact on its business.

Started by Jose Antonio de Cuervo in the late 1700s before Mexican independence from Spain, Jose Cuervo says it is North America's oldest continuous producer of spirits.

With origins in the picturesque town of Tequila in Jalisco state, the business is now controlled by the Beckmann family, which plans to remain the majority shareholder after the IPO.

The company has said proceeds from the IPO will be used to fund growth, as well as broaden its portfolio. (Reporting by Lauren Hirsch in New York and Christine Murray in Mexico City; Additional reporting by Alexandra Alper in Mexico City; Editing by Marguerita Choy)

11 PHOTOS
Various tequila drinks
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Various tequila drinks

Tequila shots with wedges of lime and salt

(Photo via Getty)

The Paloma: Tequila with grapefruit juice, lime, sugar, and club soda

(Photo by Jamie Grill/Getty Images)

Switch up the Screwdriver with tequila instead of vodka

(Photo via Getty)

Swap tequila in for rum in your next mojito. Trust us!

(Photo via Getty)

Spike your next hot chocolate with tequila to warm up a chilly night.

(Photo via Shutterstock)

Make your own shandy with a splash of tequila, your favorite beer, and lemonade. 

(AP Photo/Matthew Mead)

This June 9, 2014 photo shows a Texas tequila milkshake in Concord, N.H. Aged tequilas pair beautifully with ice cream. The alcohol will prevent the mixture from freezing solid. (AP Photo/Matthew Mead)
Hundreds of guests celebrate the closing night of Oculto Manor and the introduction of Oculto, a unique lager blended with beer aged on tequila barrel staves on May 2, 2015 in Miami, Florida. (Photo by Gustavo Caballero/Getty Images for Oculto Manor)

A classic lime margarita on the rocks

(Photo by Aimee Herring, AOL)

Strawberry margarita

(Photo via Getty)

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