Category: Equity

Panama’s BG Financial Group, the holding company for Banco General, has requested authorization to register common shares on the local stock exchange. No date or schedule for an IPO was included. The group was formed last year through the merger of Grupo Financiero Continental with Banco General Financial, and its shareholders are Empresa General de Inversiones (61%) and Grupo Financiero Continental (39%).

In the March 18 brief titled “Credit Suisse ECM Head Jumps to Merrill” we incorrectly stated the date of Sebastien Chatel’s departure from UBS. He left the firm in March of 2007.

Credit Suisse will likely replace Sabastien Chatel, its departing head of ECM, in the coming several weeks, according to officials at the firm. Internal executives and outside candidates will be considered for the role, they say. Chatel is leaving Credit Suisse to co-head LatAm ECM at Merrill Lynch after having spent under a year at the former. While Credit Suisse executives downplayed Chatel’s departure, emphasizing his short time at the helm of the regional franchise and CS’s dominance prior to his arrival, the shop is heard to have considered matching Chatel’s Merrill offer to keep him. Still, the consensus remains that Credit Suisse’s ECM platform is a solid, multi-tiered effort that relies on strong regional relationships for its business. One departure is unlikely to derail that momentum. But an externally driven market downturn like the one LatAm is experiencing today is sure to shrink ECM revenues, and the shops with the biggest dedicated staffs might be the first to feel the pinch.

Merrill Lynch has poached Sebastien Chatel from Credit Suisse, where he was head of LatAm ECM. He joins the US shop – which is on a hiring spree in Brazil – in a co-head position and regroups with former UBS colleagues who recently jumped ship to Merrill, including Alexandre Bettamio, former investment banking co-head at UBS Pactual. Chatel is named co-head of LatAm ECM, presumably sharing the beat with Juan Vogeler, Merrill’s LatAm ECM chief. Bettamio, along with three other senior UBS Pactual bankers, jumped ship to Merrill earlier this week, a move which struck local bankers as curious given the bank’s woes in the US. But late yesterday, Merrill officially announced the moves, which include five other mid and junior-level bankers, saying the hires are part of a push by the firm to increase its footprint in high growth economies. Chatel, who left UBS in 2006 for Credit Suisse, led the latter’s ECM business to the top of the league tables. The two Swiss shops dominate the Brazilian equity market and originated the vast majority of the region’s IPOs and follow-ons last year. Merrill participated in a handful of equity deals, but did not come close to pulling in the mountain of fees bagged by UBS and CS. However, given the poor LatAm ECM outlook for 2008, that fee pool looks hugely eroded.

Mexican housing company Desarrolladora Homex has approved $250m to buy back its own shares. It did not offer further details regarding a buyback. Shares closed yesterday at MXP100.99.

The board of America Latina Logistica has approved a 1-year share buyback program of up to 5m outstanding shares. The Brazilian logistics company has 343.3m shares outstanding. Shares closed Monday at BRL17.00.

Solvay Indupa, a petrochemicals company headquartered in Buenos Aires and Sao Paulo, plans an IPO on the Bovespa by listing Brazilian depository receipts (BDR). UBS Pactual is slated to lead the offering, for which details on number of shares and price range are yet to be divulged. Petroquimica Comodoro Rivadavia is another Argentine petrochemical company that planned a listing of BDRs, according to a filing made last September. However, that process, being led by Credit Suisse, has since been interrupted, according to the CVM.

Brazil’s Norcon has filed to sell shares on the Bovespa. The 50-year old residential builder and developer based in the northeastern state of Sergipe plans to use the proceeds for land acquisition, infrastructure development, refinancing of debt and for general purposes. No further details were disclosed. Credit Suisse will manage the sale. While close to 20 residential developers have gone public in the past two years causing sector fatigue among investors, few developers outside the Sao Paulo and Rio areas have attempted offerings. That should provide Norcon with a much needed edge when it comes to marketing the deal to the buyside.

Brazil’s stock exchange saw foreign investment inflows of BRL598m in the week ended February 26, according to Itau, which cites its own data and Bovespa numbers. That continues a trend of inflows that started in the previous week, and reduces the YTD net outflow to BRL4.057bn. The Bovespa jumped 5% in the same period, and is up by the same amount YTD. “We have seen a recovery trend in the foreign investment flow to the Bovespa, especially during February, after several January outflows,” says Itau. “This is definitely in line with the positive scenario we are forecasting for Brazilian equities.” However, externally, the picture appeared to worsen during the period. The Dow was down sharply Friday and Itau concludes that volatility will remain high for the foreseeable future.

Cosan will Thursday give investors in Cosan SA, the original, Bovespa-listed entity, the chance to migrate shares to Cosan Ltd, a US-listed entity created last summer whose voting shares are 90% controlled by a group led by founder Rubens Ometto Mello. The process is part of a promise Cosan made to shareholders to extend the right to own shares in the new holding company. But it is more of a gesture than anything that will concretely alter the status quo. Holders of 272.5m Cosan SA shares will have the option to switch into Cosan Ltd A shares or BDRs. Investors that held Cosan SA on July 26 2007 also have the option to swap their 1-vote A shares in Cosan SA for 10-vote B2 shares in Cosan Ltd They will be subject to a 3-year lockup that effectively requires them to hold onto 100% of the non-listed stock, lest it be converted into 1-vote A shares. If they do choose that path, they would still have far less than 10% of Cosan Ltd voting rights, since 90% of the voting capital in Cosan Ltd is held by Ometto Mello. “At current prices, we see no reason for shareholders to participate in the exchange offer, unless they have a very large position and liquidity becomes an issue for them,” says Itau. Investors have until April 11 to trade in CSAN3 shares.