Brazil’s JHSF Participacoes has hit the 25% equity free float required by regulators, it says, through a BRL152.3m ($83.8m) follow-on sale of secondary shares. Controllers of the developer sold 26.3m shares at BRL5.83 each last week through an expedited public offering known as an advanced bookbuild. BTG Pactual managed the sale.
Category: Equity
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Chilean Financial Group Plans IPO
Chilean Investment firm Inversiones La Construccion plans to IPO this year, and will put the matter to a shareholder vote April 16, it says. The investment arm of Camara Chilena de la Construccion, which is a holdco for firms including AFP Habitat, Consalud and the Tabancura and Avansalud clinics, is looking to raise around $300m-equivalent, and has hired Bank of America Merrill Lynch, IMTrust and JPMorgan, according to local press reports citing remarks from company management. Construction company Ingevec raised $26m-equivalent last month, and drilling company Terraservice last week announced its intention to IPO this year.
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Equity Funds Lose Flows
EM equity funds saw outflows of $130m during the week ending March 28, with LatAm equity funds accounting for $334m in outflows, according to EPFR. LatAm funds saw a 0.04% gain during the week ending March 29, and are up 14.63% on the year, according to Lipper. EM funds lost 0.22% during the week and have risen 13.14% on the year. Global small and mid-cap funds, by comparison, were up 0.85% on the week, and 13.91% on the year.
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MRP Closes Real Estate CCD
Mexico Retail Properties (MRP), a unit of US-based private equity manager Black Creek, has sold MXP5bn ($390m) in certificados de capital de desarrollo (CCD) in Mexico’s domestic market, according to regulatory documents. The 2027 certificates offer investors participation in a fund investing in commercial and service-related real estate assets throughout the country. The return structure is similar to other CCDs, with investors receiving their original amount plus a preferred return, with remaining proceeds divided 80% to investors and 20% to managers. Banamex and BBVA Bancomer managed the transaction. MRP’s sister unit I Cuadrada closed a MXP2.74bn social infrastructure-focused CCD in December, in which MRP co-invested 10%.
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BTG Seen Launching Next Week
BTG Pactual has started pre-launch investor education meetings and is heard planning to launch its highly-anticipated IPO as soon as early next week. Based on the typical timetable for Brazilian equity transactions, if the deal is launched next week it would likely price the week of April 23. The deal is expected to raise BRL2.0bn-BRL2.5bn ($1.10bn-$1.37bn), but the markets will have a better idea of the total amount when the price range and number of shares to be sold is disclosed at the time of launch. The BRL2.5bn level would imply a price-to-book valuation of more than 3x, analysts say, well above peers such as Itau and Bradesco. While the consensus may be that the bank deserves a premium for its story and what it has accomplished, 3x-plus may be difficult for buyers to accept given the recent history of IPO pricings in Brazil. A 2.0x price-to-book is normal for retail-plus-investment bank competitors, investors and analysts note. BTG, Bradesco, Goldman Sachs and JPMorgan are managing the deal. Other Brazilians in the pipe could also launch as soon as next week, including fleet outsourcer Locamerica, furniture maker Unicasa, and oil services provider Seabras.
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Colombia Construction IPO Oversubscribed
Colombia’s Construcciones El Condor has received COP323bn ($183m) in orders for its IPO, it says, following Tuesday’s close of the order period. It is scheduled to allocate the transaction – and thus determine the final size of the offer – on Monday. The builder launched the offer of 106m shares March 6, at COP1,415 each, meaning an expected COP162bn sale if a 9m share overallotment is exercised. The sale represents a 20% float. Bancolombia is managing.
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Posadas Finishes Convert Sale
Mexico’s Grupo Posadas has raised MXP900m ($71m) through the sale of convertible 2014 domestic bonds in a private sale to its existing shareholders, it says. The 9.0% bonds will mandatorily convert at the maturity, and are secured by MXP300m of the hotel operator’s assets. The transaction was done to increase the company’s liquidity. The deal should lower adjusted leverage to 6.1x from 6.8x as of December 31, 2011, Fitch says.
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Chilean Driller Plans IPO
Chilean drilling services provider Terraservice plans to hold an IPO, a company official says, and aims to do so by the end of the year. The company, which is looking to expand into other LatAm markets, is still in the planning stages, but is looking to float 30%, around $50m. Terraservice had been looking at 2014 for the fundraising, the official says, though good market conditions have led it to focus on this year or perhaps early 2013. Proceeds would fund investments, most notably an entrance into Peru’s market. This expansion could later be followed by other countries, such as Colombia or Argentina. Celfin has been hired to manage the IPO process. Terraservice gained recognition through its participation in the 2010 rescue of 33 miners trapped under the Atacama Desert.
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LatAm Equity Funds Loose Cash
EM equity funds saw inflows of $782m during the week ending March 21, however LatAm equity funds dragged this total down with $119m in outflows, according to EPFR. LatAm funds saw a 2.31% loss during the week ending March 22, and are up 14.61% on the year, according to Lipper. EM funds lost 2.30% during the week and have risen 13.40% on the year. Global small and mid-cap funds, by comparison, were down 1.35% on the week, and 12.94% on the year.
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Builder Prices First Chilean IPO of the Year
Chilean construction firm Ingevec has priced a CLP12.51bn ($25.6m) IPO, the first in Chile this year. The deal was always going to be small, but it underwhelmed somewhat, with the CLP48.10 price coming below a CLP50 target and market expectations of just above CLP50. Demand was CLP69.35bn, from 382 accounts, Ingevec says. Domestic retail investors accounted for 36%, domestic pension funds for 29%, domestic non-institutional investors 20% and Foreigners 15%. Ingevec is raising funds for its engineering and construction projects, as well as to execute the investment plan for its real estate business. About 90% of the issuer’s business is construction and engineering, it says, for which it claims a $450m equivalent backlog, and the remainder real estate. The float represents about 30% of the company, with 70% remaining in the hands of a controlling group led by CEO Enrique Besa. LarrainVial managed the sale, which was originally intended for last year before market turbulence got in the way.