BTG Pactual plans to sell Friday 247.2m shares, or 10.65% of Vanguarda Agro through an auction, only days after announcing it had purchased a 10.87% stake. The bank and asset manager plans to sell the shares at BRL0.35 each, indicating a BRL87m ($48m) total sale. BTG had acquired the shares in the biofuels producer, formerly known as Brasil Ecodiesel when one of Vanguarda’s shareholders used them to repay debt to BTG.
Category: Equity
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Generator Joins Peruvian Equity Pipeline
Peruvian securities regulators have authorized state-owned power utility Empresa de Generacion Electrica del Sur (Egesur) to publicly list shares on the Lima Stock Exchange, according to an official at the company. He declines to offer details about any specific transaction, and says no advisors have yet been hired. Peru’s market is expected to see more new issuance activity in 2012 provided conditions are benign. Cementos Pacasmayo is preparing a New York follow on, and port operator Andino Investment Holding plans a $60m local IPO pricing January 17.
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BTG Invests in Biofuels Producer
BTG Pactual has obtained a 10.87% stake in Brazilian biofuels producer Vanguarda Agro. The bank and asset manager acquired 252.3m shares, a stake that would be worth BRL88m ($48m) at Monday’s BRL0.35 close. Vanguarda was formerly known as Brasil Ecodiesel.
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Peru Cement Maker Set for NY Listing
Peru’s Cementos Pacasmayo (CPAC) is planning an equity follow-on, marking what would be its debut New York listing. The Hochschild Group-controlled cement maker is seen looking to raise about $250m to fund the expansion of its La Rioja plant and also develop a phosphate and brine project. JPMorgan and Santander are managing the deal, which would bring the total of New York-listed Peruvians to 5.
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Port Operator Targets Lima IPO
Andino Investment Holding is planning to raise as much as $60m-equivalent in a January 17 share offering. The port operator is looking to sell 15m-30m shares, heard likely to come at around PES5.10 each. If the full amount is sold at this price, the issuer is looking at raising PES153m ($57m). Proceeds would be used to reduce debt and for expansion projects. BCP is managing the sale. Andino borrowed $85m from Goldman Sachs last year to purchase fellow port operators Neptunia and Agencia Maritima.
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Santander Brazil Surrenders 4.41% to Qatari Bondholder
Spain’s Banco Santander has transferred roughly 4.41% of its Santander Brasil subsidiary to a Qatari government vehicle holding its convertible bonds, exercising an option to covert the notes ahead of schedule as it looks to meet capital requirements. Santander transferred the shares to a third party that would then deliver them to the convertible bond holders, the bank says. The Brazilian unit had transferred to its parent ADRs representing approximately 5.18% of the unit. In October 2010, Santander sold $2.72bn in 6.75% of 2013 convertible bonds to Qatari Holdings, which were convertible into shares at Santander’s discretion at exchange price of BRL23.75 per share. Santander Brasil shares closed at BRL15.34 Monday. The decision to exercise its right to convert the bonds is one of several ways the bank is trying to meet 9% core capital ratio requirement established by the European Banking Association. Santander officials could not immediately be reached for additional comment. The Spanish bank has been shedding asset in Latin America, and cut costs, most recently by laying 15 people from its New York offices in December. Rivals ING and RBS have also recently reduced their LatAm teams in NYC.
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Bancolombia Launches $885m Preferred Share Offering
Bancolombia has begun a massive 64m preferred share offering that stands to generate $885m for Colombia’s largest financial institution. The issue, which represent 8.12% of all shares outstanding, will be offered to established shareholders at COP26,000 ($13.83) per share, and the unsold balance is to be sold to overseas buyers, Bancolombia says. The shares are registered both in the local Colombian bourse and in New York’s NYSE Euronext as ADRs. The deal is being managed by Bancolombia’s investment banking arm, while Brigard & Urrutia is handling the legal aspects of the transaction. The bank has sought additional capitalization especially since it spent $150m in joining Grupo Sura’s bid for ING’s LatAm insurance assets late last year. It has also been trying to improve operational efficiency. In a recent LatAm banking note, Santander’s equity research analysts kept a hold rating on the bank’s shares, noting that they “do not expect a turnaround in the [bank’s] cost efficiency situation and [remain] discouraged by the bank’s relatively weak capital position.”
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EM Equity Sees Positive Start to Year
In contrast to fixed-income, EM equity funds saw a comparatively positive start to 2012, bringing in some $469m for the week ending January 4. It was a different story for LatAm equity funds which suffered some mild hemorrhaging with $66m in net outflows during that period. Still, stock markets put in an impressive performance, with EM and LatAm equity funds up 1.68% and 2.49% for the week ending January 5, according to Lipper. That compares to a more modest 1.36% gain among global small and mid-cap funds.
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Petroperu Seeks Advisor For Mid Year Share Offering
Peru’s oil company Petroperu is about to launch a formal search for an advisory firm that can structure the sale of a 20% stake in the state-owned company. If all goes as planned, Petroperu should sell shares to the public sometime in June or July of 2012, Edilfredo More, Petroperu’s CFO tells LatinFinance. “We want an advisor to value the company, structure the deal and tell us if the company is ready to go to market of if we need to restructure and strengthen different areas of the business first,” says More. So far Petroperu has no estimated value of the company. More hopes an advisor will also tell the company it can sell the 20% at once or start with a smaller fraction. “We seek to relaunch Petroperu,” says More. Petroperu has already registered with the Lima Stock Exchange, but it remains to be seen if the share sale will give priority to Peruvian investors. The company now controls Peru’s main refining plants and a crude oil pipeline, but it is now seeking to move into the upstream side of the business. The equity offering is expected to help fund the overhaul of Petroperu.
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Struggling Lupatech Gets Capital Lifeline
Brazil’s leading oil industry valve maker, Lupatech, will receive up to a BRL700m ($379.3m) capital infusion as it struggles with a cash crunch and crippling leverage. Lupatech’s top shareholders along with private equity fund GP Investments, have agreed to recapitalize the troubled oil services company as it seeks to increase profitability and pay off debt. Under the agreement, BNDES Participacoes, the holding of the BNDES development bank and Petros, the employee pension fund unit of Brazil’s oil company Petrobras, will initially put up BRL300m ($162.6m) in cash. GP will pay BRL50m also in cash, with the rest to come from other shareholders. As part of the capitalization the company will issue shares to shareholders at BRL4 per share, Lupatech says. Also 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 BRL50 million in equity. The shareholders are also expected to revamp the Lupatech’s administration, according to a material fact filing. Officials at Lupatech could not immediately offer additional details on the move. Lupatech, the leading oil services provider to Petrobras, has led an aggressive growth through acquisitions that have resulted in elevated levels of debt. Last October Moody’s lowered the company’s rating to Caa2 from Caa1 citing the company’s weak liquidity, high leverage and low profitability. As of June 2011, Ebitda margin for Lupatech stood at 9%, according to Standard & Poor’s. S&P reckons that the company’s BRL1.3bn in debt translated to an Ebitda interest coverage of 0.3x, and a debt to Ebitda of 22.5x at the end of September. S&P analysts expect the company to rollover its credit lines, increase its Ebitda margin to 17% and to bring total debt to Ebitda to 8x in 2012.