Mexican mining, transport and infrastructure company Grupo Mexico is hoping to raise $1.3 billion from an initial public offering of its ITM rail unit, one of its senior executives said. The company still hopes to list ITM in the first half of the year and expects the offering to be in high demand, Ferromex Chief Executive Rogelio Velez told Reuters in an interview. Ferromex is ITM's main railroad and the largest in Mexico. Grupo Mexico intends to list around 15 percent of ITM stock, Velez said. This would value the rail unit, a key beneficiary of Mexico's auto manufacturing boom, at around $8.7 billion. He added that Mexico's GBM and Credit Suisse were underwriters. Velez said Grupo Mexico, which slowed rail unit investment last year as a new anti-trust competition bill worked its way through Mexico's Congress, would spend the money from the IPO on new rolling stock and other capital expenditure. The legislation ultimately was less punishing on Mexico's railroads, a duopoly controlled by Grupo Mexico and a local unit of Kansas City Southern, than had been proposed, paving the way for the ITM IPO. As a result of the new rules, a rail regulator will be created in the coming months, a move that Velez said he welcomed. Grupo Mexico controls 75 percent of ITM, with the rest controlled by Mexican billionaire Carlos Slim. (Reuters)