Qualicorp has priced a BRL758.5m ($408m) equity follow-on, according to the CVM, finally giving Brazil its first marketed equity sale of the year. The health insurer is selling 45.97m secondary shares, including a 15% greenshoe, at BRL16.50 each, offering a 1.26% discount to Tuesday’s BRL16.71 closing price. In the selldown, US private equity firm Carlyle was to go from a 39.49% stake to a 26.03% position and founder Jose Seripieri Filho to reduce his share from 27.85% to 26.26%, according to a prospectus. Seripieri had initially wanted to walk away with just 19.85%, though pushback resulted in Qualicorp reducing the size of the deal by lowering the number of shares to be sold by Seripieri. Bank of America Merrill Lynch, Bradesco, Credit Suisse and Goldman Sachs managed the transaction, which started off a busy two weeks in the LatAm equity markets. Fleet rental agency Locamerica is up next, with an IPO expected at up to BRL488m Thursday.
Category: Equity
Brazilians to Kick off Equity Flood
The next 2 weeks will feature heavy issuance in the LatAm equity markets, beginning with Qualicorp. The Brazilian health insurer is to sell today 39.2m secondary shares, including a 15% greenshoe, meaning a BRL652m ($356m) deal if done at Monday’s BRL16.62 closing price. The holders lowered their sights from an originally planned 55.8m share deal that could have seen them pocket more than BRL900m. Bank of America Merrill Lynch, Bradesco, Credit Suisse and Goldman Sachs are managing. Fleet outsourcing provider Locamerica is to follow Thursday with an IPO of up to BRL488m, via Banco do Brasil, Banco Votorantim, Bank of America Merrill Lynch, BTG Pactual and Itau. The following Tuesday brings a BRL1.29bn follow-on from Fibria, through Itau, Bank of America Merrill Lynch, Banco do Brasil, BTG, Deutsche Bank and Santander, as well as the long-awaited IPO of BTG Pactual. The Brazilian investment bank could raise up to BRL3.5bn in its debut seen as a test for ECM prospects this year. BTG, Bradesco, JPMorgan, Goldman Sachs, Citi, Banco do Brasil, Morgan Stanley, Deutsche Bank and UBS are managing. Finally, April 25 will see Alpek attempt to revive Mexico’s ECM with a MXP11.96bn ($910m) IPO and Brazil’s Unicasa bring an IPO of up to BRL623m.
Seabras Puts off IPO Again
Norway’s Seadrill has again postponed the IPO of its Brazilian Seabras Servicos de Petroleo unit, it says. It had initially hoped to sell in February, before pushing the deal to April, and is now targeting an IPO before the end of the year. The company is to adopt a master limited partnership structure, with the aim of lower future financing costs and increased dividend capacity, and has prioritized this ahead of the IPO. Seabras has completed the necessary corporate restructuring and received the required consents from Petrobras, with whom it has long-term drilling contracts. Seabras had been looking at raising up to BRL1.44bn ($787m) from an all-primary share offering. The owner of 3 drillships was spun off last year, and needs funds for acquisitions and other investments as it looks to cover a wider range of oilfield services in Brazil. It generated BRL524.7m in Ebitda in the first 3 quarters of 2011, up from BRL371.2m in the corresponding period in 2010. BTG, Citi, Morgan Stanley, Banco do Brasil and HSBC were hired to manage the sale.
Colombian Targets REIT Sequel
Improving issuing conditions have Colombia’s Terranum Inversion planning to quicken the pace of share sales from its Patrimonio Estrategias Inmobiliarias (PEI) domestic real estate income trust, and follow up a recent $88m-equivalent sale with another this year, Terranum’s CEO says. “About $75m-$100m should come on line by the end of the year. Clearly there is a lot of appetite, but not a lot of product,” Jose Ignacio Robledo tells LatinFinance, noting that PEI remains the only REIT in Colombia. Normally, PEI would only issue once a year. The trust started in 2007 now stands at $450m-equivalent following a COP155.13bn ($88m) sale, its fourth tranche, last month. All but just over $10m-equivalent was sold to existing investors exercising their rights, he says, with about $900m-equivalent in demand for the small portion that remained for the open market. Participants included institutional investors and family offices, Corredores Asociados managed the sale. Despite the demand, there have yet to be other REIT imitators in Colombia, at least with the US market-inspired REIT structure that Terranum uses. Part of the challenge is finding single-ownership assets, as opposed to the multiple-owner format traditionally favored in Colombia, Robledo says. The former is better suited for a sale-leaseback deal and inclusion in the fund, and gettingg large corporations to do this has not been easy. The trend is positive however, improving from 5 years ago when companies needed to be convinced that owning all of their real estate assets made little financial sense. Retailer Exito is an example of a large corporate landowner that has seen the value of sale leasebacks, he says. The government implementing regulation defining a standard for REITs in Colombia would also help stimulate the asset class. With average returns around 15%, Terranum’s fund invests in corporate and retail centers in Colombia’s major cities, but is looking to branch out to more of the mid-sized cities. “Clea
Alpek to Test Mexican IPO Appetite
Alpek has launched an IPO targeting as much as MXP11.96bn ($910m), giving investors a look at Mexico’s first large IPO since 2010, as the overall outlook for the country improves. At first glance, analysts see the implied valuation as in line with or slightly expensive to the industry average, depending on where the 379.8m primary shares price within the MXP27.50-MXP31.50 range. Such a deal would raise MXP10.44bn-MXP11.96bn for the Grupo Alfa petrochemicals producer. The share total assumes the exercise of an overallotment option. Pricing is scheduled for April 25. “At that range it could come at the high end of the sector,” says a Mexico City-based equity analyst, spotting the valuation at 6.9x-7.8x 2012 earnings, compared to Mexichem’s 7.6x and a 7.3x sector average. “It is in line with other companies in the sector,” says an analyst at another shop, pointing to 7.0x-7.8x, versus a global average of 7.5x. “There should be strong appetite for this transaction,” says an ECM banker away from the deal, noting he expects a similar demand to Fibra Uno’s well received follow-on last month. The polyethylene and polypropylene producer, many of whose products are used in the food and beverage industry, is raising funds to repay debt and for general corporate purposes. Credit Suisse, Citi, HSBC and Morgan Stanley are managing the sale, in which 75% of the shares are marked for international distribution. It would be the first Mexican IPO since BanRegio raised MXP2.09bn in July 2011, and the first $500m-plus offer since OHL Mexico in October 2010. The deal will provide a further test for new issuance in Mexico, which both bankers and investors have become more optimistic about, considering recent macroeconomic and political developments as well as an outperformance of the Bolsa. “Mexico needs to have more issuance, and it should be quite easily digested, because investors are hungry for diversification in Mexico. Also, Mexico is full of sectors that investors want get acces
Cedae Ponders IPO
Rio de Janeiro state-owned water treatment company Cia Estadual de Aguas e Esgotos (Cedae) is studying an IPO, it says. Cedae does not give an indication of timing or size, but does note the government would maintain a controlling stake in the company. The company is still in the process of choosing banks to advise in the process, an investor relations official says, declining to give additional details.
Fibria Reschedules FO
Brazil’s Fibria has postponed an expected BRL 1.26bn ($687m) equity follow-on to April 24, from April 19, it says. The Brazilian pulp producer began roadshowing at the beginning of the month for the all-primary sale of 86m shares. This would indicate a BRL1.26bn deal, based on Wednesday’s BRL14.61 close and assuming the exercise of a 15% greenshoe. The sale would be the first offering under the new Fibria name, though both Votorantim Celulose e Papel and Aracruz were longtime Bovespa members, and is done to raise funds for repaying debt and general purposes. Following the sale, the ownership should remain the same, according to the prospectus, with 30% each stakes for Grupo Votorantim and for BNDESPar, and 40% to other shareholders. Itau and Bank of America Merrill Lynch are global coordinators, with Banco do Brasil, BTG Pactual, Deutsche Bank and Santander as bookrunners.
Taesa Advances Equity Sale
Brazil’s Transmissora Alianca de Energia Eletrica (Taesa) is analyzing conditions for the public sale of additional shares, it says. The transmission unit of Cemig had previously been heard preparing such a deal and hiring BTG Pactual and Bank of America Merrill Lynch to manage. The transaction is expected to raise up to BRL2bn ($1.09bn).The follow-on sale would in many ways function as an IPO for the relatively illiquid shares. Cemig bought Taesa, then known as Terna Participacoes, in 2009 from Italy’s Terna, and has indicated it would look to increase the unit’s float. Taesa shares closed at BRL60.50 Thursday.
Corpbanca OKs $650m Raise
Shareholders of Chile’s Corpbanca have approved a $650m capital increase, in a needed step to finalize the December acquisition of Santander’s Colombia unit, Corpbanca says. The capital increase will result in the issuance of 48bn new shares that Corpbanca hopes to sell between May and June, an investor relations official says. Corpbanca plans to begin a road show in May and expect to have obtained the funds by the end of June. The capital increase comes as a prerequisite to finalizing the acquisition of Santander’s Colombia assets, first announced in early December. As agreed, Corpbanca is acquiring a 95% stake in of the Santander unit in Colombia for $1.16bn, a transaction with an implied multiple of roughly 2.7x book value.
Enersur Lands Captial Raise
Shareholders of Peru’s Enersur have subscribed to 99.39% of the shares offered in a PES401m ($151m) capital increase, the power generator says. The 24m shares came at PES16.50 each, during the first round of the process. A second round offering the remaining shares to the public is scheduled to open Thursday and close Monday. Enersur is controlled by France’s GDF Suez. Enersur shares closed at PES19.80 Tuesday.