Alfa de CV : Alpek signed an agreement with ContourGlobal for the sale of its two cogeneration power plants for US $801 million

January 7, 2019
Alpek signed an agreement with ContourGlobal for the sale of its two cogeneration power plants for US $801 million

Monterrey, Mexico. January 6, 2019 - ALFA, S.A.B. de C.V. (ALFA), announced today that its subsidiary Alpek, S.A.B. de C.V. ('Alpek') signed a final agreement for the sale of its Cosoleacaque and Altamira cogeneration power plants, located in Mexico.

Under the terms of the agreement, Alpek will sell its entire stake in the companies that own both facilities, Cogeneración de Altamira, S.A. de C.V. and Cogeneración de Energía Limpia de Cosoleacaque, S.A. de C.V., for an aggregate amount of US $801 million to ContourGlobal Terra 3 S.à.r.l, a subsidiary of ContourGlobal PLC.

Alvaro Fernandez Garza, ALFA's President, commented: 'This transaction is in line with ALFA's strategy to both create value for its shareholders and reduce leverage. Together with Axtel's recent divestiture in its mass-market business, revenues from the sale of non-strategic assets exceed US $1 billion. Proceeds from these sales will substantially strengthen our balance sheet, reducing ALFA's Net Debt to EBITDA ratio (proforma 3Q18) from 2.7 times to 2.4 times'.

In accordance with the purchase agreement, the price will be subject to certain adjustments and is due on the closing date, which is expected during the first half of 2019.

The transaction is subject to customary closing terms and conditions, including corporate approvals and authorization by the Comisión Federal de Competencia Económica in Mexico.

As required by the applicable laws and regulations, Alpek prepared an information memorandum for this transaction, which is available at www.alpek.com or at the Mexican Stock Exchange's website www.bmv.com.mx.

About ALPEK
Alpek is a leading petrochemical company operating two business segments: 'Polyester' (PTA, PET and polyester fibers), and 'Plastics & Chemicals' (polypropylene, expandable polystyrene, caprolactam, and other specialty and industrial chemicals). Alpek is an integrated producer of PTA and PET in North America, the largest expandable polystyrene manufacturer in the Americas, and the only producer of caprolactam in Mexico. Alpek also operates one of the largest polypropylene facilities in North America. In 2017, Alpek reported revenues of U.S. $5.2 billion and EBITDA of U.S. $384 million. The Company operates 23 plants in the United States, Mexico, Canada, Brazil, Argentina and Chile, and employs more than 5,000 people. Alpek is a publicly traded company listed on the Mexican Stock Exchange.

About ALFA
ALFA is a holding company that manages a portfolio of diversified subsidiaries: Sigma, a leading multinational refrigerated food company, focused on the production, marketing and distribution of quality foods through recognized brands in Mexico, Europe, United States and Latin America. Alpek, one of the world's largest producers of polyester (PTA, PET and fibers), and the leader in the Mexican market for polypropylene, expandable polystyrene (EPS) and caprolactam. Nemak, a leading provider of innovative lightweighting solutions for the global automotive industry, specializing in the development and manufacturing of aluminum components for powertrain, structural components and for electric vehicles. Axtel, a provider of Information Technology and Communication services for the enterprise, government and mass market in Mexico. Newpek, an oil and gas exploration and production company with operations in Mexico and the United States. In 2017, ALFA reported revenues of Ps. 317,627 million (US $16.8 billion), and EBITDA of Ps. 38,312 million (US $2.0 billion). ALFA's shares are quoted on the Mexican Stock Exchange and on Latibex, the market for Latin American shares of the Madrid Stock Exchange.

Contact:

Luis Ochoa Reyes
Vice President, Corporate Communications
ALFA, S.A.B. de C.V.
[phone]
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