Brazil’s Locamerica plans to price a BRL384m-BRL488m ($211m-$268m) IPO April 19, moving the date back one day from April 18, it says. The vehicle outsourcing provider is offering 18.2m primary shares, along with 12.2m secondary shares owned by Banco Votarntim’s BV Empreendimentos e Participacoes private equity fund, at BRL11-BRL14 each, it says. This would mean a BRL488m sale at the top of the range or BRL384m at the bottom, assuming a 15% greenshoe is used. A 20% hot issue is also available. A roadshow for the local and 144a sale began last week. Locamerica, which will use the symbol LCAM3, plans to use 60% of the proceeds for expanding its fleet and the remainder for working capital. Banco do Brasil, Banco Votorantim, Bank of America Merrill Lynch, BTG Pactual and Itau are managing the transaction. The April 19 date still has it on track to be the first Brazilian IPO of the year, slotting in ahead of BTG Pactual and Unicasa, both scheduled to price the following week.
Category: Equity
Lupatech Inks Capitalization Deal with Shareholders
Troubled Brazilian oil services company Lupatech has finally agreed on a capitalization deal with its main shareholders, it says. Several weeks after announcing a BRL700m ($379.3m) capitalization plan, Brazilian development bank BNDES and Petros, the employee pension fund of Brazil’s oil company Petrobras, have agreed to put up BRL300m of the total capital sought. The remaining amount is to come from shareholders that will acquire additional 175m shares that Lupatech plans to issue at BRL4.00 a share. The price compares to the BRL4.56 previous closing. Lupatech shares closed at BRL 5.07 Monday. Officials at Lupatech could not immediately comment further. As part of the deal Lupatech will absorb the assets of San Antonio International, currently owned by GP Investments, which include drill rigs and well services divisions. Lupatech and GP have estimated an enterprise value of San Antonio Brasil at BRL150m, with BRL100m in debt and BRL50m in equity. The shareholders are also expected to revamp Lupatech’s administration. The company’s bonds were heard reaching levels of 70 late Monday, up from 58.
Redecard Valuation in Line with Itau Offer
The BRL35.88 per share independent valuation of Brazilian credit card processor Redecard is in line with Itau’s BRL35.00 offer made for the company in February, according to analysts. The finding by Rothschild, hired by minority Redecard holders, leaves little room for Itau to increase its offer price, Deutsche Bank says, calling it fair and recommending that minority holders accept. Citi and BR Partners are set to issue a fairness opinion on Rothschild’s valuation report, Deutsche says, which should be performed over the next 2 weeks. This would be followed by a final tender offer from Itau. “Whether or not Itau will be successful in the tender offer we think the above concerns mean that a large pricing power held by the controlling shareholder make it more difficult for minorities to argue for a better price in this negotiation,” Barclays says. Barclays expects the tender to take place and Itau to end up buying most of the Redecard free-float, if not all, even if it is less than the minimum two-thirds required to de-list Redecard. Itau has offered to purchase 336.4m Redecard shares, or 49.985% of the company, for BRL35.00 per share, with the intention to delist it. Itau is advising itself in the process.
Brazilian Furniture Maker Launches IPO
Unicasa Industria de Moveis has commenced investor meetings ahead of an April 25 IPO targeting BRL502m-BRL623m ($274m-$340m). The Brazilian furniture manufacturer has filed to sell 9.1m primary shares, as well as 17.3m secondary shares held by controller Alexandre Bartelle and members of the Zietolie family. A BRL16.50-BRL20.50 price range indicates a BRL623m deal at the top of the range, assuming the exercise of a 15% all-secondary share greenshoe. Unicasa, which through its Dell Anno, Favorita, New and Telesul brands targets all levels of the Brazilian income ladder, is raising funds for expansion, particularly in products aimed at the country’s C class. A portion of the primary proceeds would also be used to pay a dividend to shareholders, according to the filing. Unicasa claims to be Brazil’s sector leader in terms of gross revenue – BRL402m in 2011 – and that it has the potential to open 566 new stores throughout Brazil, including 457 for its New brand targeting the C class. The issuer, founded in 1985 and based in Bento Goncalves in the state of Rio Grande do Sul, posted BRL80.4m in Ebitda in 2011, up from BRL72.9m in 2010. BTG Pactual, Itau and Santander are managing the sale. Unicasa puts itself on the calendar at the end of what will be a busy 2 weeks in Brazilian equity that perhaps sets the market’s tone for the remainder of the year. Health insurance provider Qualicorp is to hold a BRL600m follow-on April 17, followed by the BRL400m IPO of fleet outsourcing agency Locamerica April 18, and a BRL1.2bn follow-on from pulp producer Fibria April 19. The BRL3bn-plus IPO from BTG Pactual comes April 24, followed by Unicasa.
JBS Appoints Officials, Advances Vigor Spinoff
Brazilian meatpacker JBS has received CVM approval to list shares of the Vigor Alimentos unit, it says, and has named people to senior posts at its subsidiaries. The timetable for an IPO remains unclear. Mauricio Hasson has been picked as CFO of Vigor, joining from Rothschild, where he advised on M&A transactions, JBS says. Separately, Andre Nogueira is the new CEO of JBS’ Australian operations, moving from the CFO position at JBS USA. He is replaced by Denilson Molina as US CFO.
BTG Aims High with IPO
BTG Pactual is targeting as much as BRL3.5bn ($1.9bn) in its IPO, which at the high end of its price range would top the market’s previous estimations for the much-anticipated sale. The Brazilian investment bank launched Tuesday ahead of an April 24 pricing seen as a clear test of Brazilian new issuance prospects this year. BTG is betting on strong demand based on interest in the Brazilian and regional growth story and its being the first BRL2bn-plus IPO from Brazil since late 2010. Valuing the shop that is a combination of investment bank, private equity manager, asset manager and other functions continues to be a tricky proposition, as there are few, if any, direct comps available. “The deal should be well received given the size. It’s a quality name that has done a good job of expanding,” says an EM portfolio manager, who sees a valuation at roughly 2.5x-3.0x book. Initial speculation had valuations as high as 3.5x. “This will get a lot of attention, but the question is what am I buying into,” says another EM investor, noting it is difficult to value certain pieces of the bank, such as proprietary trading and asset management. Though investors may see as much as 3.0x, BTG is heard describing the price as implying a 2.2x-2.6x book valuation, against a bucket of comps – including banks, investment banks, and asset managers. The bank plans to sell 72m primary units and 18m secondary units, at BRL28.75-BRL33.75 each, meaning a BRL2.98bn-BRL3.49bn size. The total assumes a 15% greenshoe, made up of 10.8m primary units and 2.7m secondary units. A 20% hot issue is also available. The units each consist of one preferred and one ordinary share in Banco BTG Pactual, and one common and one non-voting common share in the BTG Pactual Participations offshore entity. The IPO will feature a Brazilian portion and an international portion done in Amsterdam. The secondary shares are to be sold by 5 investment vehicles representing the holdings of investment firm JC Flowers and the
Qualicorp Holders Lower Sights
Shareholders of Brazil’s Qualicorp have lowered the target for a BRL600m-plus ($335m) equity follow-on, and pushed the pricing date back. The transaction will now offer 39.2m shares, including a 15% greenshoe, instead of the previous 55.8m, the health insurance provider says, meaning a BRL610m deal if done at Tuesday’s BRL15.55 closing price. The sale will price April 17, pushed back from April 12. US private equity firm Carlyle is set to go from a 39.49% stake to 26.03% following the deal – unchanged from the initial filing – and founder Jose Seripieri Filho from 27.85% to 26.26% – a higher stake than the 19.85% he had originally wanted to keep. Bank of America Merrill Lynch, Bradesco, Credit Suisse and Goldman Sachs are managing the transaction.
Locamerica Launches IPO
Brazil’s Locamerica plans to raise up to BRL488m ($267m) in its IPO, and has scheduled an April 18 pricing. The vehicle outsourcing provider is offering 18.2m primary shares, along with 12.2m secondary shares owned by Banco Votarntim’s BV Empreendimentos e Participacoes private equity fund, at BRL11-BRL14 each, it says. This would mean a BRL488m sale at the top of the range or BRL384m at the bottom, assuming a 15% greenshoe is used. A 20% hot issue is also available. A roadshow for the local and 144a sale was scheduled to begin Monday. Locamerica, which will use the symbol LCAM3, plans to use 60% of the proceeds for expanding its fleet and the remainder for working capital. Banco do Brasil, Banco Votorantim, Bank of America Merrill Lynch, BTG Pactual and Itau are managing the transaction. The April 18 date could make it the first Brazilian IPO of the year, depending on the pricing dates chosen by BTG Pactual, Unicasa and Seabras, which are also in the pipeline and expected to launch as soon as this week.
Condor Wraps Up IPO
Colombia’s Construcciones El Condor has completed its IPO, it says, allocating 114.9m shares for a final COP162.58bn ($91.6m) size. The builder received COP323bn ($183m) in orders, following last week’s close of the order period, and allocated to 1,957 different accounts. It had launched the offer March 7, at a price of COP1,415 per share. Bancolombia managed the sale, which represents a 20% float.
Actinver Closes Local Converts
Mexico’s Actinver has completed the sale of MXP500m ($40m) in domestic convertible bonds. The 2017 notes pay the TIIE minus 30bp, and are mandatorily convertible at maturity into shares at a price of MXP13.41. Actinver managed the sale itself.