Brasil Travel Turismo e Participacoes’ had still not priced its initial public offering by late Wednesday night as markets awaited what could be the first Brazilian IPO of 2012. The holdco for a nationwide group of travel-related businesses was trying to sell 170,000 primary shares and 466,500 secondary shares at a BRL1,250-BRL1,650 range. Such a deal would raise BRL1.21bn total size if priced at the top of the range, or BRL915m at the low end, assuming the use of a 15% greenshoe. Bankers on the deal did not return requests for comment. Though the management boasts ex-BTG Pactual partner Pedro Guimaraes as chairman and is headed by Paulo Castello Branco, a former VP of Brazilian airline TAM, investors were hesitant about the company’s short operating history. Some of the 35 member businesses have been in operation for years, but they were only assembled into Brasil Travel in March 2011. The company plans to use the primary proceeds to grow in Brazil and in other countries in LatAm, with about 85% of the funds to be spent on acquisitions. The secondary shares are sold by the founders’ holding vehicle, owned by Guimaraes, the Sette family and Jose Marcilio Nunes. The deal is expected to leave Brasil Travel with a 40% free float. Barclays, Credit Suisse, Flow Corretora and Santander are managing the sale.
Category: Equity
Brazil’s Ale Ponders IPO
Ale Combustiveis, a Brazilian fuel distribution company, is pondering an initial public offering, an option that company owners and their private equity partners have contemplated for some time. Timing has yet to be determined but much depends on market conditions, company official says. An IPO is part of the company’s business plan given that the private equity firm Darby, a unit of Franklin Templeton Investments, holds a small stake in the company, the official adds. Ale is considered the sixth largest fuel distribution company in the Brazilian market competing with such names as Petrobras, BR Distribuidora and Ultrapar, which dominate the local fuel supply business. The company has more than 1,750 service stations across the South American country and controls roughly a 5% share of the industry.
Peruvian Cement Co. Makes ADR Debut
Peru’s Cementos Pacasmayo has priced a $264.5m equity follow-on, representing its debut ADR offering. The cement maker sold 20m ADRs, representing 100m shares, at $11.50 each, landing at the bottom of a $11.50-$13.00 range. It will raise $264.5m from the sale, assuming the exercise of a 3m ADR greenshoe. Its Peru shares closed Tuesday at PES6.85. The offer is seen as essentially being an IPO for the cement company, as its Lima shares are relatively illiquid. “It is a good story, though there may have been some concern about the size,” says a US-based equity investor ahead of the pricing. Buyers say they like the Peru growth story and that a great deal of Pacasmayo’s business is tied to retail sales for self-construction, which can offer higher returns. Pacasmayo is raising funds for the expansion of its La Rioja plant and also for the development of a phosphate and brine project. JPMorgan and Santander managed the transaction. Founded in 1949, Pacasmayo is one of 2 companies making up the Hocschild Group, along with Hocschild mining. Chairman Eduardo Hocschild’s Inversiones Pacasmayo owned 63.9% of Cementos Pacasmayo prior to the sale, and was set to have 52.7% afterwards, according to regulatory documents. The next large equity deal in the region is the BRL1.2bn IPO of Brasil Travel, scheduled for today.
EM Equity Flows Surge
EM equity funds brought in $3.52bn in inflows for the week ending February 1, marking a new high over the last 43 weeks, according to EPFR. LatAm funds accounted for $254m of that total. LatAm funds are up 2.89% for the week ended February 2 and 15.63% on the year, according to Lipper. EM funds gained 2.65% on the week and have risen 12.72% on the year. That compares to a 2.40% weekly rise among global small and mid-cap funds, which have climbed 10.47% on the year.
Small AIH Offering Marks 2012’s First LatAm IPO
It may have been small, but Andino Investment Holding’s PES116m ($43m) equity offering Thursday can lay claim to being LatAm’s first IPO this year. The Peruvian port operator sold 35m shares at PES3.30 each, in a deal offered to local investors. The issuer had tried to come to market in the third week of January, and was heard eyeing around PES5.00 per share, but it postponed the offer until Thursday. Demand for the sale was heard at 1.2x-1.3x. AIH is raising funds to reduce debt and for expansion projects. BCP managed the sale. AIH has been growing, and borrowed $85m from Goldman Sachs last year to purchase fellow port operators Neptunia and Agencia Maritima. Bigger initial offerings are set to follow in the region. Brasil Travel is preparing to raise up to BRL1.21bn ($703m) on Wednesday, and Colombia’s Construcciones El Condor should launch soon an IPO of at least $70m-equivalent this month.
US PE Shop Enters LatAm
US-based private equity firm H.I.G. Capital has opened an office in Rio de Janeiro, hiring Fernando Marques Oliveira to head it and lead the firm’s LatAm operations. It is the first regional office for H.I.G., which operates in North America and Europe. Oliveira joins from General Atlantic, where he was involved in several LatAm deals, including investments in Mabel, Aracruz and Grupo ABC. H.I.G. has $8.5bn under management globally.
Bancolombia Prices New York Follow On
Bancolombia has raised $300m in the international portion of its follow-on equity offering, pricing 5m ADRs representing 20m preferred shares at $60.00 each, according to bankers on the trade. The deal represents the remaining shares after Colombians bought 44m shares at COP26,000 each to raise COP1.14trn ($614m) in a domestic offer that closed last week. The price comes at a 3.24% discount to the ADRs’ $62.01 Tuesday close. The $914m-equvalent total follow-on comes as the bank seeks additional capital after spending $150m to join Grupo Sura’s bid for ING’s LatAm insurance assets late last year. It has also been trying to improve operational efficiency. UBS was global coordinator of the ADR sale, with Bank of America Merrill Lynch and JPMorgan coming in as joint bookrunners. Bancolombia’s own capital markets arm managed the domestic portion. Bancolombia’s Colombian shares closed Tuesday at COP27,960.
Bancolombia Preps NY ADR Sale, Closes Local Issue
Bancolombia appears set raise COP1.14trn ($614m) from domestic investors participating in its equity follow-on that closed Friday, with an international portion pricing as soon as today. Locals buyers demanded 44m shares out of a total of 64m shares, the bank says, with the remainder to be sold through an ADR offering expected to price today or tomorrow. The local tranche was launched at the beginning of the month, with the Colombian bank offering the shares at a price of COP26,000 each. Bancolombia’s own capital markets arm managed the domestic portion. UBS is global coordinator of the ADR sale, with Bank of America Merrill Lynch and JPMorgan participating as joint bookrunners.
Peru Port Operator to Try IPO Again
Peruvian logistics company Andino Investment Holding (AIH) expects to price a $50m-$60m IPO on Thursday after cancelling an initial sale that had been scheduled for January 19. The port and logistics operator is looking to sell 15m-30m shares, and is expected to price at around PES5.00 ($1.86) per share. Proceeds are be used to reduce debt and for expansion projects. BCP is managing the sale. AIH borrowed $85m from Goldman Sachs last year to purchase fellow port operators Neptunia and Agencia Maritima.
Seabras Reschedules Equity Debut
Seabras Servicos de Petroleo has pushed backing the timing of an up to BRL1.44bn ($823m) IPO to early April after having initially scheduling pricing for next week. The Brazilian spinoff of Norwegian oil services provider Seadrill explains that it has reached an agreement with Petrobras, its main client, to make “certain changes to its corporate structure,” but it cannot do this and still carry out the IPO with its 3Q2011 numbers. As a result, it will have to re-file with 4Q2011 numbers, meaning an April pricing is more likely. Seabras intends to sell 48m primary shares, setting a range of BRL20.00-BRL26.00 per share. This would indicate a BRL1.44bn size at the top of the range, or a BRL1.1bn sale at the bottom, assuming a 15% greenshoe is used in each case. A 20% hot issue is also available. The owner of 3 drillships with long-term Petrobras contracts was spun off last year and is raising funds for acquisitions and other investments as it looks to cover a wider range of oil field 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. It is also negotiating a 50-50 joint investment with pipe-laying support vessel operator and fellow Petrobras contractor SapuraCrest. BTG Pactual, Morgan Stanley and Citi are managing the deal. Brasil Travel is expected to be the first IPO from LatAm this year after scheduling an up to BRL1.21bn offer for February 8. However, Peru’s Andino Investment Holdings could beat it to the punch if a rescheduled $50m-$60m IPO goes ahead Thursday.