ALFA Shareholders approved proposal to spin-off Nemak

On August 17, 2020, ALFA S.A.B. de C.V.

Rhea-AI Summary

On August 17, 2020, ALFA S.A.B. de C.V. (BMV: ALFAA) announced the approval of a spin-off of its entire ownership stake in Nemak, S.A.B. de C.V. (BMV: NEMAKA). At an Extraordinary Shareholders' Meeting, ALFA's Board presented the plan to separate Nemak into a new entity named Controladora Nemak, which will be listed on the Mexican Stock Exchange. Shareholders will receive one share of Controladora Nemak for each ALFA share they hold. The spin-off aims to enhance ALFA's value potential and provide independent management for Nemak, slated for completion within 60 days.

Positive

• Shareholders will receive one share of Controladora Nemak for each ALFA share held.
• The spin-off is expected to unlock ALFA's full value potential.
• Nemak maintains a strong operational track record and industry position.

Negative

• None.

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SAN PEDRO GARZA GARCÍA, N.L. Mexico, Aug. 17, 2020 /PRNewswire/ -- ALFA S.A.B. de C.V. (BMV: ALFAA) ("ALFA") held today an Extraordinary Shareholders' Meeting where a proposal to spin-off its entire ownership stake in Nemak, S.A.B. de C.V. (BMV: NEMAKA) ("Nemak") was approved.

On behalf of ALFA's Board of Directors, Armando Garza Sada, Chairman of the Board, and Álvaro Fernández Garza, President, presented the proposal through which ALFA will execute the spin-off as a splitting entity. In addition, a new entity would be constituted as the spun-off company ("Controladora Nemak"), which will be listed on the Mexican Stock Exchange. ALFA will transfer its entire share ownership in Nemak to Controladora Nemak, as well as certain assets and capital. ALFA expects to complete the spin-off process within the next 60 days.

ALFA shareholders will receive one share of Controladora Nemak for each of their ALFA shares, in addition to retaining their share ownership in ALFA's equity.

"We greatly appreciate our Shareholders' vote of confidence in our strategy to unlock ALFA's full value potential. The spin-off approved today marks the first step in ALFA's transformational process towards fully independent business management; as compared to the legacy conglomerate structure," noted Armando Garza Sada, Chairman of ALFA's Board of Directors.

"Nemak has a very successful track record operating separate from the Parent. In addition to its leading industry position and world-class capabilities, the Company has an extraordinarily talented team that will continue to drive sustainable, long-term value creation for all its stakeholders. To ensure a smooth transition, Nemak will continue to receive all our support," said Alvaro Fernández Garza, President of ALFA.

For more information, please visit https://www.alfa.com.mx/SP/press.htm

iralfa@alfa.com.mx 
www.alfa.com.mx
+ (52) 81-8748-2521

View original content:http://www.prnewswire.com/news-releases/alfa-shareholders-approved-proposal-to-spin-off-nemak-301113467.html

SOURCE ALFA, S.A.B. de C.V.

FAQ

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What did ALFA S.A.B. de C.V. announce on August 17, 2020?

ALFA announced the approval of a spin-off of its entire ownership stake in Nemak, creating a new entity called Controladora Nemak.

What will shareholders of ALFA receive in the spin-off?

Shareholders will receive one share of Controladora Nemak for each ALFA share they own.

When is the spin-off of Nemak expected to be completed?

The spin-off process is expected to be completed within 60 days.

What is the purpose of the spin-off for ALFA?

The spin-off aims to unlock ALFA's full value potential and facilitate independent business management for Nemak.

Will Nemak continue to receive support from ALFA after the spin-off?

Yes, Nemak will continue to receive support from ALFA to ensure a smooth transition.