Companies in Mexico wouldn't go public because of crimes

Companies in Mexico are scrapping plans to float shares on the stock exchange for fear of raising their profile amid a brutal drug war and a surge in kidnappings, the bourse president said on Tuesday.
Stock exchange President Guillermo Prieto said that aside from market volatility in the past two months due to the global financial crisis, crime was a major issue for firms thinking about initial public offerings (IPOs).
"Obviously, market conditions are very difficult but (crime) has become a factor, so people don't want to put their surnames on a share listing," Prieto told a business forum in the northern city of Monterrey.
"At least six or seven companies have said crime is a reason (for not listing)," he said.
More than 4,300 people, mostly drug smugglers but also police and soldiers, have been killed this year as President Felipe Calderon's army clampdown on drug cartels sparks battles between rival cartels and security forces.
Kidnappings, often carried out by gangs led by corrupt police, have also surged and the public has been shocked by recent cases of abducted children being brutally murdered.
Going public to raise funds for expansion requires far greater company disclosure and a higher public profile for company executives who go on roadshows to attract investors.
Mexican business leaders say operations have not been hurt by the drug war and they mostly support Calderon's deployment of some 40,000 troops and federal police to catch drug gangs.
Many businesses have stepped up security, however, and some company owners in violent northern border cities such as Tijuana are conducting their business from the United States to avoid the risk of being kidnapped. (Reuters)