Chile’s Ingevec has approved the resumption of its IPO plans, which had been put off in August. The construction and engineering company plans to sell up to 270m shares, the same amount as last year. The issuer had been looking last year to raise at least $30m-equivalent to fund expansion projects, with LarrainVial hired to manage the deal. Separately, the company named Enrique Dibarrart as CEO of the Constructora Ingevec unit.
Category: Equity
Posted inDaily Brief
Qualicorp Defines Selldown
Brazil’s Qualicorp is looking at a BRL856m ($495m) size on its planned all-secondary share equity follow-on, according to information in regulatory documents. The health insurer that made its Bovespa debut last year plans to sell 48.5m shares, which means raising BRL856m if done at Monday’s BRL15.34 share price and a 15% greenshoe is exercised. A 20% hot issue is also available. It still has not release a timeline. The two selling shareholders are a holding vehicle for private equity firm Carlyle and a vehicle owned by founder and board president Jose Seripieri Filho, both also sellers in the BRL731m secondary portion of last year’s IPO. Bank of America Merrill Lynch, Bradesco, Credit Suisse and Goldman Sachs are managing.
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Banco Galicia Eyes Card IPO
Argentina’s Banco Galicia is planning an IPO for its Tarjetas Regionales credit card subsidiary, it says. The bank has internally approved a sale of up to $200m in the foreign and domestic markets. The timing is unclear, as there are still several regulatory measures to go through. Bank of America Merrill Lynch, JPMorgan and Morgan Stanley have been advising on the process, a bank official says. Tarjetas Regionales is a holdco for brands including Tarjeta Naranja, Tarjeta Nevada and Tarjeta Mira, as well as a processor and collection company serving them.
Posted inDaily Brief
Brazil PE Not Scared of Overinvestment
Private equity funds still see ample opportunity in Brazil despite the large amounts of money being deployed there. The vaguely defined “middle market” is still the sweet spot while new international firms have set up shop there amid expectations that valuations may be heading lower. Advent International’s Patrice Etlin estimates there is somewhere around $11bn in PE money available for Brazil at the moment. “Yes, it is a record number for Brazil. There has never been so much money and interest, but we are not in a situation like those found in other very hot emerging markets such as China, and it’s still far from the amount of capital committed in the US and other developed markets. If you compare it to the size of the broader Brazilian economy, it is still a relatively modest number,” Etlin tells LatinFinance. “There is a lot of opportunity in the $25m-$50m ticket space,” says Chris Bruneau, executive director at 57 Stars, an EM-focused fund of funds. “There are five to seven groups trying to raise money in that space. Even if they raise all of the money they hope to, there is going to be a pretty open market for PE in Brazil. There are a lot of opportunities.” Valuations have moved up in general, but this has occurred more at the top end of the market, Bruneau explains. However the slowdown in Brazil over the last three to six months has raised expectations that valuations should come down a bit. “We are moving toward a period of price adjustment and we expect to see the value reduction we’ve seen in the public markets migrate to private transactions. It hasn’t happened yet, so as a result we are currently seeing much less investment activity in private deals,” Etlin says. Meanwhile, Marcelo di Lorenzo, head of 3i Brazil, sees the middle market also having to accept lower valuations despite expectations to the contrary. ““In the middle market, the expectations could go up, but it is not as strong as in the higher-ticket deals. The companies soon realize that they
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LatAm Equity Flows Reverse
EM equity funds saw inflows of $1.03bn during the week ending February 29, despite LatAm equity fund outflows subtracting $89m from the total, according to EPFR. LatAm funds saw a 1.69% return during the week ending March 1, and are up 20.00% on the year, according to Lipper. EM funds gained 1.78% during the week and have risen 16.99% on the year. Global small and mid-cap funds, by comparison, are up 0.15% on the week, and 14.29% on the year.
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Suez Peru Unit Plans Rights Offer
The board of Peruvian electricity generator Enersur has approved a capital increase of up to PES401m ($150m) through a rights offering of 24.3m shares, it says. Holders will have a right to 0.12 new shares for each share held, at a price of PES16.50 each. The price includes a nominal value of PES1.00 and a bonus of PES15.50 per share. It does not indicate timing. Enersur is controlled by French utility GDF Suez.
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BTG Valuation Still Unclear as Bank Files IPO
Predicting the valuation of BTG Pactual remains difficult, analysts say, after the bank officially filed its long-expected IPO Thursday. The documents give no details about the size of the deal or number of shares to be sold. The popular market guess has been for a BRL2bn ($1.17bn)sale, with the bank being given a total value of $14bn-$15bn. This would imply a price-to-book valuation of more than 3x, analysts say, well above peers such as Itau and Bradesco. “The bank deserves a premium for its story and what it has accomplished, but 3.5x would be difficult.” says a Rio-based investor. He notes the deal will be a good test for the market and if successful could go a long way to lifting new issuance this year. “It is difficult to make predictions for an investment bank [compared to retail], and the tendency is to work with lower multiples,” says a Sao Paulo-based FIG equity analyst, noting that a good starting point would the 2.0x price-to-book trading levels seen on retail-plus-investment bank competitors. “But that [conservative tendency] may be wrong here. There is a lot of confidence in [CEO] Andre Esteves’ entrepreneurship,” he adds, noting enthusiasm for Banco Panamericano shares during the tag along offer after BTG took over the troubled retail bank. “This is a strong operation with good liquidity,” adds a Rio-based FIG analyst, noting that it will all depend on the markets, which, though the Bovespa is up this year, have been rough on new deals. There will be a domestic sale and an international sale on the Euronext Amsterdam, according to the prospectus. BTG plans to sell units consisting of preferred and ordinary shares, as is common with Brazilian bank IPOs. Adding an additional layer of complexity is that the units will also incorporate shares in Brazilian entity Banco BTG Pactual and Brazilian Depository Receipts for the BTG Pactual Participations offshore entity. The transaction will include primary shares, as well as secondary shares to be sold by the
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Canadian Miner Cross-Lists in Peru
Dia Bras Exploration, a Toronto-listed Peruvian miner, has had its shares approved for listing on the Lima stock exchange it says, and the shares have started to trade. The precious and base metals miner with operations in Peru and Mexico is considering raising funds in the region, a spokesman says, but there are no immediate plans to do so.
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Cencosud Avances ADR Plan
Shareholders of Chilean retailer Cencosud have approved the setting of the price of shares to be offered abroad, according to a spokeswoman, a technical step in the previously announced plan to list ADRs. The share issue will be used to finance the company’s growth, and would come under a $2bn total capital increase approved last year. The firm now has 120 days to set the price, the spokeswoman says. There have been no details yet released for the New York sale. JPMorgan and UBS are heard to have the mandate, with Santander and BBVA expected to work on the local portion.
Posted inMagazine
Andean Spotlight
Andean Spotlight In an overall slow start to 2012, Peruvian issuers outshone the rest, coming with the region’s first IPO and a US ADR debut. Peru’s Cementos Pacasmayo raised $264.5 […]