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Grupo Los Grobo says Brazil IPO will have to wait

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Argentina’s leading agricultural conglomerate, Grupo Los Grobo, is keeping its planned initial public offering on stand-by as market conditions are not yet suitable.

Los Grobo President Gustavo Grobocopatel said in an interview in the coastal city of Cartagena, where he is attending a hemispheric summit, that the company’s IPO plans on Sao Paulo’s BM&F Bovespa stock exchange remain on hold.

“It’s not just a problem of market performance,” he said. “We are looking at demand for new placements and liquidity and we don’t think it’s the right time,” he said.

The company received a capital infusion in January after Japan-based Mitsubishi Corp. (MSBHY, 8058.TO) took a 20% stake in the Brazilian operations of the group for an undisclosed sum.

The company is still focusing its efforts in Brazil, which represents the focus point of its international expansion.

As much as 60% of all fields in Argentina are farmed through sharecropping with Los Grobo and other firms.

The group’s business model has flourished in Brazil amid a surge in soybean production. Only the U.S. exports more soybeans than Brazil, with Argentina coming in third in global soybean exports.

For this year, Grobocapatel said that production will increase as weather conditions improve after the passage the La Nina weather phenomenon.

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