Mexico’s Aeroportuario del Centro Norte (OMA) has priced a MXP2.76bn ($214m) follow-on of shares owned by Empresas ICA, landing at a 4.0% discount. After an initial postponing of the deal last week, the 69m secondary shares priced at MXP40.00 each, according to a filing. The total assumes a 15% greenshoe and the price compares to the previous MXP41.68 closing level Monday. OMA shares closed at MXP40.31 Tuesday. Some 60% of the deal went to international buyers and 40% to Mexicans. The stake represents 17.25% of the airport operator and was trimmed down from the 95m share deal originally planned for last week and delayed due to market volatility. The Mexican builder is selling the OMA shares through its Aeroinvest subsidiary. Bank of America Merrill Lynch was global coordinator for the deal, joined by Barclays, BBVA, Morgan Stanley and Santander as joint bookrunners. The deal comes as part of a fundraising plan to improve ICA’s liquidity position as its project backlog stalls, and follows a $380m exit from the RCO toll road partnership last month. Next up in Mexico’s ECM is the $2bn-plus follow-on from Banorte, scheduled for July 16.
Category: Equity
Peruvian Builder Sets FO Target
Peru’s Grana y Montero is targeting more than $400m for the follow-on equity sale representing the debut of its ADS shares, according to a regulatory filing. The builder is selling 16.3m ADS, representing 81.4m common shares, at $19.70-$23.30 each in the US market, in a deal expected to price July 23, according to a person following the sale. The range indicates a $402m sale at the midpoint, assuming a 15% greenshoe is used. About 60% of the proceeds will go to infrastructure projects, 20% for acquisitions, 10% for the purchase of land for its real estate business and 10% for general corporate purposes. BTG Pactual, Credit Suisse, JPMorgan and Morgan Stanley are managing the sale, with BBVA, Credicorp and Interbank as co-managers.
LatAm equity deals hoping for take-off
OMA’s follow-on has demonstrated sellers may need to lower expectations, but hopefuls in the pipeline are pressing ahead.
Empresas Carozzi Taps Shareholders for Capital
Chilean food producer Empresas Carozzi is to tap shareholders for a $100m-equivalent capital raise, to strengthen its financial position after acquisitions and a fire at a pasta plant, LatinFinance understands. Carozzi SA owns 75.6% of Empresas Carozzi and Tiger Brands owns 24.4%. As part of financing for that raise, holdco Carozzi SA will tap its own shareholders for CLP37.5bn ($74m) via the sale of 28.8m shares. The initial offering process for the Empresas Carozzi raise is expected July 25 through August 24. Carozzi SA is owned 86% by the Biofill Group.
ICA Plans Second Pass at OMA Follow-On
Mexican construction firm Empresas ICA says it will try again to sell shares in Grupo Aeroportuario del Centro Norte (OMA) through an all-secondary equity follow-on sale which it postponed last month. ICA has trimmed the size of the offer to 69m shares, assuming a 15% greenshoe option is exercised. That equates to 17.25% of the company, and would bring in MXP2.9bn ($223m) at Monday’s closing price. In the initial follow-on plan, which was pulled on June 26 after a volatile run in equity markets, ICA targeted a sale of 95m shares, including the greenshoe option. OMA’s shares closed at MXP41.68 on Monday, having recovered from the MXP37.97 level where they traded in late June but still down from their MXP47.09 level of mid-May, when ICA first filed a shelf for the equity sale. ICA is selling the shares via its Aeroinvest subsidiary. Bank of America Merrill Lynch is global coordinator for the deal. Barclays, BBVA, Morgan Stanley, Santander are joint bookrunners.
Fibra Shop Targets MXP5.8bn in IPO
Mexican retail-focused real estate fund Fibra Shop could bring in MXP5.8bn ($443m) from its primary and secondary share offering, scheduled for July 23. The fund will sell up to 214m primary shares, including a 15% greenshoe option, and 98m secondary ones at between MXP17.5 and MXP19.5 each. Three property developers, Grupo Cayon, Grupo Aportante Frel and Grupo Central de Arequitectura are the secondary sellers. BTG Pactual, Actinver, Merrill Lynch are international leads, with Banorte joining for local distribution. The cash raised will go to finance existing loans and real estate acquisitions, and to new purchases.
MPX Cans Follow-On, Batista Resigns
Brazilian power generator MPX Energia cancelled the public follow-on equity offering it signaled last month, opting to tap existing shareholders instead for two-thirds the amount initially targeted. MPX will raise BRL800m of equity at BRL6.45 per share. Germany energy firm E.ON will buy BRL366.7m worth of the sale. The rest will be offered to MPX’s other shareholders, with lead manager BTG Pactual picking up anything left over. The move came after MPX’s shares lost nearly a third of their value since late March, when the firm agreed a public follow-on of at least BRL1.2bn at a BRL10 minimum share price, underwritten by BTG. At that point, E.ON said it would invest BRL366m, as part of an agreement to acquire 36.2% of the firm under which it is also buying out Eike Batista’s 24.5% stake. BTG told the board of MPX last week that the BRL10 per share price was not longer feasible. At the same meeting, Batista resigned as chairman, with E.ON board member Jorgen Kildahl replacing him on an interim basis. MPX stock rallied at the end of last week to close at BRL7.3 per share, up 13% from its low on Wednesday.
Stampede from Debt, Equity Funds Eases
Investors returned cash to EM equity funds and slowed their departure from EM debt funds in the week to July 3, as markets stabilized after a heavy mid-June sell-off. EM equity funds took inflows of $706m, as investors walked back partially on outflows of $5.62bn the previous week, according to EPFR. LatAm equity funds continued suffering, however, with outflows doubling to $281.9m, although they were still less than the $493m that left such funds in the week to June 19. EM debt portfolios continued losing cash, with $956m leaving funds, but the pace had slowed from the $5.57bn outflows recorded the previous week. Analysts at Barclays say flows can be expected to stabilize after recent sharp volatility, “but a return to consistent inflows is probably not yet on the horizon, given the uncertainty over US interest rates and the lack of action (as yet) from the European Central Bank and Bank of England on new monetary measures.” In terms of performance, LatAm equity funds fell 2.74% for the week ended July 3, and are down 16.99% year-to-date, according to Lipper. EM funds were down 0.55% during the week, to bring them to a year-to-date loss of 8.94%. EM debt funds posted a 0.61% gain on the week, but are still down 6.74% year-to-date.
Mall Fibra Sets Pricing Sights
Fibra Shop, a real estate fund focusing on shopping centers, is scheduled to price its equity offering on July 23, LatinFinance understands. The primary and secondary share offering is set to total around MXP7.4bn ($567m). The deal will be Mexico’s first shopping center-based Fibra. Developers Grupo Cayon, Grupo Aportante Frel and Grupo Central de Arquitectura are placing eight shopping centers in five Mexican states into the portfolio, and raising proceeds to acquire more. Actinver, Bank of America Merrill Lynch, Banorte-Ixe and BTG Pactual are managing.
Global Accounts Stay the Course in Latin Equity as Volumes Double
International investors have supported recent equity issues despite volatile conditions, says an ECM banker as the market ends a busy first half of the year. Latin equity issuance more than doubled year on year in the first half, hitting $21.4m equivalent from 46 transactions, according to Dealogic. While the number of deals is not vastly higher than the 36 sold in the first half of 2012, the amount issued is more than twice the $9.8bn sold in that period. The sharp increase in equity sales has sparked a shake-up in the league tables, also. Credit Suisse, which ranked 10th in the first six months of 2012, led Dealogic’s ECM league table for the year on July 1. Itau BBA similarly jumped, from ninth to second place, pushing BTG Pactual, which led the table this time last year, into third place. Difficult market conditions in recent weeks have slowed the pace of issuance: one follow-on was downsized and another shelved last week as share prices dropped. Yet despite the volatility, foreign investors have continued to underpin the new issuance market, says Santiago Gilfond, managing director, ECM, at Credit Suisse. “You’d think that in volatile times foreign investors would flee, and issuers would rely more on domestic investors. But recent transactions have been somewhat the opposite. We’ve seen foreign investors represent a larger proportion of demand, in part because it is a broader investor base.” Despite growth of Mexico’s institutional investors, for example, they remain limited as a buyer base, he says. “There are a limited number of pension funds and asset managers, and then there are retail accounts. Having some key local investors not participate due to market volatility has a disproportionate effect.” But local investors will look increasingly at equity issues as they expand and regulators allow them greater freedom to do so. “Latin American investors, in particular pension funds, are going to be more focused on the international equity market as their options