August 29, 2014 / 5:58 PM / 4 years ago

UPDATE 1-Mexican bread maker Bimbo plans stock offering

MEXICO CITY, Aug 29 (Reuters) - Mexican bread maker Grupo Bimbo, the world’s largest baker and maker of Entenmann’s cakes and Oroweat bread among other brands, said on Friday it is planning to sell new shares in Mexico and abroad, marking its first foreign listing.

Shares in Bimbo were the worst-performing stock on Mexico’s IPC stock index, falling 1.54 percent to 42.18 pesos in morning trading, as investors reacted to the potential dilution of their holdings.

The company is seeking to raise funds to pay down a credit line it took out to pay for its acquisition earlier this year of Canada Bread, as well as for general corporate financing purposes, according to a preliminary prospectus filed with Mexico’s stock exchange.

The bread maker has been buying up bakeries in the United States, Spain and most recently Canada helping secure its position as the world’s No. 1 baker by sales volume and revenue.

Bimbo, which also makes Thomas’ English Muffins and Tia Rosa tortillas, did not give details about how much it seeks to raise, or when it could close the offering.

Citigroup’s local unit Banamex was listed on the prospectus as the bookrunner.

The company will hold an extraordinary board meeting on September 18 to discuss the proposals, according to an earlier filing with Mexico’s stock exchange. (Reporting by Elinor Comlay; editing by Gunna Dickson)

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