Category: Equity

Brazil’s BM&F Bovespa exchange has spent BRL192m to buy back 34.19m of its shares. Like many Brazilian companies, the holdco created by one of the region’s biggest mergers last year has been taking advantage of low prices to repurchase shares. It approved a 1-year share buyback program in September for up to 71.26m shares, or 3.5% of its float.

As inflation slows in Brazil, economists expect the central bank to start easing rates in January 2009. “December’s IPCA-15 came in at 0.29%, well below our forecast of 0.40% and median market consensus of 0.43%,” says UBS Pactual, which expects headline inflation to stay at around 0.30%, bringing the 12-month figure to just below 6.00% by the end of 2008. Barclays, meanwhile, says that that the domestic supply-demand imbalance may no longer pose an inflation threat near term, and that global disinflationary forces should help contain domestic inflation. They place inflation at 4.50% in 2009. The economists add that they expect the central bank to start an easing cycle in January with a 50bp cut. The Selic stands at 13.75%.

A group of Colombian cattle ranch and agricultural land owners are close to pricing Colombia’s first IPO in a year. Medellin-based Fondo Ganadero (Fogansa) aims to finalize bookbuilding by Friday. The deal was 20% subscribed as of Tuesday. The offering is made up of 20m ordinary shares at COP2,000 per unit, to raise a total of COP40bn ($18m). Bancolombia is running the, the first from its sector in Colombia, according to bankers on it. Agricultural companies in Brazil and Argentina like SLC Agricola, Brasil Agro and Cresud have in recent years tapped equity markets for funds.

Mexican pharmaceutical company Genomma Lab says it has set aside up to MXP1.07bn in cash for potential acquisitions of medicine brands. The funds were raised during its MXP2.4bn June IPO on Mexico’s Bolsa. The company wants to expand its participation in the personal hygiene and OTC medicines in Mexico. It also expects to see revenues grow up to 22% in 2009, excluding potential acquisitions.

Vicunha Textil, a Bovespa-listed textiles maker, says it will have to provision for a negative derivatives position in the amount of BRL32.6m. The FX derivative contract was signed with Citi’s Brazil-based bank and the company originally said it believed the loss to be around BRL28m, based on numbers through September 30.

Shares of Brazilian computer manufacturer Positivo Informatica jumped to BRL6.16 Monday from the BRL4.75 Friday close, a 29.7% leap, following media reports that Lenovo Group and Dell are interested in acquiring it. A Positivo spokesperson denies the reports, saying that the company has “no knowledge” of such an approach. Local press reported the M&A rumor over the weekend, citing UBS Pactual as a Positivo advisor. Brazil’s Bovespa closed 8.31% firmer at 38,284 Monday amid global equity markets strength.

Colombian state-controlled electricity grid operator Interconexion Electrica has priced COP104.5bn ($46m) in reopened 2026 bonds. The notes paying a coupon of the IPC rate plus 4.58% were discounted through an auction mechanism resulting in a yield of IPC plus 7.1%. The transaction was 1.63x subscribed. Citi, Correval and Bancolombia managed the sale, rated AAA on a national scale.

Bradesco and Brazilian healthcare provider Tempo are the two latest Bovespa members to repurchase sagging shares. Bradesco plans to absorb up to 7.5m preferred shares and up to 7.5m common shares in a program running through May 2009. The bank has a total of 2.04bn shares outstanding, including 551m common and 1.49bn preferred units. Tempo, a healthcare network administrator and claims processor that raised BRL420m in a December 2007 IPO, has meanwhile approved a 1-year program to purchase up to 7.5m shares, or 10% of its float. Bradesco’s common and preferred shares closed Monday at BRL20.19 and BRL23.47, respectively. Tempo finished at BRL2.50.

Panama’s BG Financial Group is planning to sell $250m in perpetual bonds to finance growth plans, according to a Dow Jones report, which cites a filing with the Panamanian Stock Exchange. The group’s banking subsidiary Banco General will issue the bonds on the local exchange this week, the report states. Proceeds will be used to fund the bank’s commercial, mortgage and consumer lending businesses in Panama and abroad, it adds.