Updates with details, analyst comments
MEXICO CITY, Dec 22 (Reuters) – Shares in Grupo Aeromexico AEROMEX.MX rose sharply for a third day on Wednesday, bucking the initial impact of a restructuring plan under its Chapter 11 bankruptcy proceedings in the United States which had slashed the value of the airline’s stock.
The shares rose as much as 58%, or 3.43 pesos per share, with a cumulative increase of nearly 200% this week, driven by what analysts said was speculative buying.
The surge comes after the stock slumped to an historic low of 0.90 pesos last week after the announcement of a public tender offer by an unnamed third party which proposed offering 0.01 peso for each outstanding Aeromexico share.
“It’s speculation, we don’t see anything other than that,” Carlos Hernandez, an analyst at Masari Casa de Bolsa, said of the market appetite for the airline’s stock.
Despite the rally, which has led the stock exchange to repeatedly carry out volatility auctions on Aeromexico’s stock, the shares are still some way below 4 pesos, the price they were trading at before the tender announcement.
Analysts and traders said further details on restructuring plans would be likely to determine future market moves.
“The company has to clarify the conditions of the takeover bid and then see how professional investors who determine whether or not it’s convenient to participate in the takeover behave,” said Gustavo Fuentes, an independent market analyst.
(Reporting by Noe Torres and Valentine Hilaire. Editing by Jane Merriman)
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