Category: Equity

Le Lis Blanc Deux Com e Confeccoes de Roupas, a maker of women’s clothing and related products, has filed to sell shares on the Bovespa. The company, 85% controlled by the Artesia fund, did not indicate the timing of the offer, of both primary and secondary shares. Merrill Lynch will coordinate the transaction.

Cyrela Brazil Realty has cancelled plans to do an IPO on the Bovespa. The sale, for which an amount had not yet been specified, was cancelled due to volatility in the capital markets. The real estate developer said it did not rule out filing for another offer in the future. Technology group IdeiasNet pulled the plug on an offer last week, while Norse Energy, Nutriplant and Copasa have each postponed offerings recently citing market turbulence.

America Movil has obtained shareholder approval to boost its share buyback fund by MXP15bn to MXP65bn, the company said Friday in a filing with the Mexican Stock Exchange.

Brazilian fertilizer company Nutriplant Industria e Comercio says it has postponed its IPO on the Bovespa Mais until February 13. It had planned to raise BRL28.9m-BRL37m through the sale of 2.07m shares plus an overallotment on January 30. The road show and bookbuilding processes are now underway. Nutriplant would be the first company to list on the Bovespa Mais, where small and mid-cap issuers can take up to seven years to reach the minimum 25% float. HSBC is coordinating the operation. Separately, Brazilian technology group IdeiasNet says it has canceled definitively its plans to hold a primary sale on the Bovespa, citing poor market conditions. Earlier this month, it announced the suspension of the 40m share offer for up to 60 days.

Developer Summer Brasil Turismo has filed for an IPO in Sao Paulo. The dates of the process and amount of shares to be sold on the Bovespa’s Novo Mercado have not yet been set. Summer plans to use proceeds to purchase land and develop real estate projects, mostly in Brazil’s northeast. Founded last year, the Sao Paulo-based company specializes in tourism-oriented real estate projects, including vacation homes and hotels. UBS Pactual will manage the sale.

The likelihood of merger talks between the Bovespa and the BM&F increased as US exchanges CME and NYMEX said Monday they are discussing a deal of their own. The announcement sets the stage for a race between the CME and the Bovespa to acquire the BM&F, according to an Itau report. The CME said last week it was acquiring a 10% stake in the BM&F through a share swap. It may eventually try to buy all of the BM&F should General Atlantic, a significant shareholder in both exchanges, choose to support a bid by the CME, say the shop’s analysts. Meanwhile the Bovespa’s CEO, Gilberto Mifano, recently told LatinFinance that a linkup with the BM&F would make sense and that the two exchanges would at some point discuss a deal. Itau speculates the threat of a bid by the CME will spur Bovespa shareholders to seek approval for a BM&F bid. “We continue to believe that this merger involving the Brazilian exchanges may occur before April 22 (the end of the lockup for BOVH3)…” says Itau. On that date, Bovespa shareholders will be free to sell an additional 24% of the exchange’s shares, which could also be used to purchase BM&F stock. Yesterday BM&F shares were down 14.5% from their November IPO price. A BM&F executive told LatinFinance he would not comment on the CME-NYMEX news and maintained that as before, there are no current discussions with the Bovespa for a deal. An executive at Goldman Sachs, the shop that advised the Bovespa on its IPO and is currently involved in the US merger, also declined to comment, as did a partner at General Atlantic.

LatAm equity offerings are getting pulled as aggressive selling and volatility continue to dominate trading. The Bovespa has alternated between severe ups and downs this week, and finished Thursday up 6%, taking the YTD performance a 10% loss. The choppiness has prompted four companies to withdraw attempts to sell shares. “There just aren’t any buyers out there,” says one ECM banker. The most recent casualty was Lamosa. The publicly traded Mexican home improvement company withdrew plans to issue an undisclosed amount of shares via JPMorgan on Thursday. Copasa, the Brazilian water and sewerage utility, was scheduled to price a secondary offering Wednesday, via Banco do Brasil and Citi, but pulled out, citing market conditions. In the IPO market, Norse Energy, scrapped its attempt to raise BRL414m through the sale of 23m shares at BRL18 via UBS Pactual. And IdeasNet, another JPMorgan deal, announced plans to postpone its debut offering, which did not get far enough with investors to identify potential pricing. The ECM banker believes that if the US equity market finds a bottom in the coming weeks, that could set the stage for a return to stability and an ensuing pickup in deal activity. Until that happens it is unlikely anyone will brave the markets. And if they see an opportunity to return, they will have to do so with fresh fourth quarter numbers, as Q3 figures go stale in the coming weeks. As such it may be a while before the above issuers make a comeback.