Category: Equity

Argentina’s Banco Hipotecario has entered into talks with HSBC in Argentina to buy local broker Hexagon Argentina, the bank said in a filing to the Buenos Aires Stock Exchange. HSBC acquired Hexagon when it bought the Argentine business of Italian Banca Nazionale del Lavoro early last year.

Brazilian property developer and construction company Gafisa debuted on the New York Stock Exchange on Friday, adding its ADRs to those of the other 31 Brazilian firms already trading on the exchange. Meanwhile, the company fixed the price for its local share offering at 26 reais per share, below that of last year’s IPO when it achieved a rate of 33 reais per share. The company is hoping to raise over 1 billion reais ($478 million) by offering 39.7 million shares – 18.7 million shares via a primary offering and 20.9 million via a secondary offering. Merrill Lynch, Itaú BBA and Citi are coordinating. Gafisa launched its IPO on Bovespa last February, raising $433 million from the sale of 400 million shares.

Argentina’s Transportadora de Gas del Sur is heard to have mandated JPMorgan and Merrill Lynch for a $500 million bonds issue. The New York Stock Exchange-listed company is looking to lower its funding costs.

Brazilian bank Paraná Banco is to join the growing list of mid-sized banks seeking to list their stock on Bovespa and has announced it is seeking to launch an IPO via the Brazilian exchange. The consumer credit bank specialist will join Nossa Caixa and Banco Pine in its plans.

Argentina’s former flagship air carrier, Aerolíneas Argentinas, is planning to list on the Buenos Aires Stock Exchange by the end of this year, or beginning of next, reports local daily Ambito Financiero. According to the paper, the airline is planning to float up to 40% of its capital. The money raised will be used to upgrade infrastructure.

Latin American assets have retraced some of their losses, but strategists are split on whether this is more than just a dead-cat bounce. Wednesday saw Mexico’s Bolsa and Brazil’s Bovespa gaining 0.83% and 1.73% respectively, but they lost 5.8% and 6.6% the previous session, respectively. Merrill Lynch says the Tuesday dip was a short-term event that does not reflect a shift in investors’ positive view of EM fundamentals. JPMorgan agrees that the sell-off should not be likened to the broader May 2006 correction. Others such as Lehman take a more bearish view, saying the correction process could last up to a month as the markets digest adjustments in Chinese policy and the US subprime mortgage market, though in the medium term, it predicts that risk aversion will subside. WestLB’s Ricardo Amorim says that while there may be a correction underway, it presents a buying opportunity as LatAm assets are set to recover. CreditSights heralds a new market environment where investors will be more cautious, lenders more discriminating and companies more pessimistic. We expect cash that has been accumulating on the sidelines to be put to work on the dips.

Colombia’s government will start to sell off its 20% stake in power generator Isagen via an IPO on February 28, reports Dow Jones. The government has set a minimum price per share of 1,130 pesos ($0.50) and is hoping to capture around $262 million from the sale. Last year, the company succeeded in swapping a large part of its US dollar debt for local-currency debt, thereby reducing its exposure to exchange-rate fluctuations. The government is hoping to emulate the path taken by state-controlled electricity distributor Interconexión Eléctrica SA (ISA), which was partially privatized in 2000 and which has become a key regional player in the sector, expanding into Panama, Peru, Ecuador, Bolivia and Brazil.

Peruvian steelmaker Aceros Arequipa is planning to issue $150 million of 10-year notes, the company said in a filing to the Lima Stock Exchange. The proceeds will go towards modernizing facilities to increase output.

Colombian steelmaker Acerías Paz del Río (APR) is to be auctioned by the government via the Colombian Stock Exchange on March 16, according to local media reports. Last year the government, together with other shareholders, set a minimum price of $185 million (425.9 billion pesos) for the controlling interest (52%) in the steel producer. APR, which is the only integrated steelmaker in Colombia, has been in receivership since 2003. Those interested in buying the company include Arcelor Mittal, Brazil’s CSN, Votorantim and Argentina’s Techint. Brazil’s Gerdau was excluded from bidding earlier this year by trade and industry regulator SIC because of monopoly concerns. The company, which is currently Colombia’s largest steelmaker, can participate in the auction if it sells some of its local assets. Local investment bank Latinvestco is handling the sale.

Brazilian sugar and ethanol-producer São Martinho has joined industry rival Cosan by listing its shares on Bovespa. São Martinho raised $175.6 million on Friday via an initial public offering of shares. The company sold 10.2 million new voting shares and shareholders sold 8.2 million existing voting shares at 20 reais per share, near the top of the price range expected. Cosan – the country’s largest producer – became the first in its sector to go public two years ago when it raised $350 million.