Category: Equity

Brazilian real estate company PDG Realty priced its IPO at 14 reais ($6.59) to raise $296 million via Banco de Investimento, Banco UBS Pactual, Deutsche Bank. The deal had been heard between 13.50 and 16.50 reais. The company is selling 45 million shares — 30 million in a primary offer and 15 million in a secondary offer. The shares will be listed on Bovespa’s Novo Mercado. PDG Realty joins a raft of other Brazilian real estate companies attracted to launch IPOs in the declining domestic interest rate environment.

Bradesco, Brazil’s second-largest private bank, has bought local, niche bank BMC, the bank announced in a note to Bovespa. It paid $375.6 million (800 million reais) in shares for the São Paulo-based payroll and retirement loans specialist. The exchange of stocks will be as follows: 600 million reais at the time of sale and 200 million reais depending on the performance of BMC in the next two years. During this period, Bradesco will manage BMC as an independent structure, maintaining its main executives. According to a filing with Brazil’s securities commission, CVM, Bradesco will increase capital by an equal amount to pay for the acquisition, worth 0.94% of Bradesco’s capital. The new shares will be issued at the close of the acquisition, expected by the end of the first half of the year. Bradesco is looking to expand and diversify its loan portfolio with the acquisition, which will give it an extra 2 billion reais of loans. Goldman Sachs advised BMC, while Bradesco’s investment banking unit Bradesco BBI advised the larger bank. Following the news of the acquisition, ratings agency Fitch placed the foreign-currency, long-term IDR rating assigned to Banco BMC on rating watch positive.

State-run power company Companhia Energética de São Paulo (CESP) said it has successfully sold $350 million worth (750 million reais) of IPCA-linked bonds due 2015 to prepay outstanding debt due 2008 and 2011. The notes, which were sold to investors under Reg S and 144A rules, carry an annual coupon of 9.75%. The issuance is part of a larger medium-term note (MTN) program of up to $975 million. Moody’s Investors Service has assigned the notes a Ba3 foreign currency rating.

Shares of Venezuela’s largest private telco, Compañía Anónima Nacional Teléfonos de Venezuela (CANTV), tumbled on Monday following further comments by President Hugo Chávez regarding the company’s nationalization. ADRs of the telco fell 11.5% at the opening of trading in New York after Chávez said on Sunday that the government would not offer compensation ahead of seizing control of the company. CANTV is Venezuela’s only company to be listed in the US. Investors are now worried that US operator Verizon, which owns a 28.5% stake in CANTV, will not be fairly compensated for its share. Furthermore, analysts are speculating that Mexico’s América Móvil, which last year offered Verizon $677 million for its stake in CANTV, may withdraw its offer.

Brazilian telephone operator GVT is to launch an IPO via Bovespa and is seeking approval from Brazilian securities commission, CNV. The operator is hoping to sell 52 million common shares and may offer an over-allotment should demand exist. Shares will be sold in Brazil and to foreign investors under 144A rules. UBS Pactual and Credit Suisse will coordinate the issue.

Shares in Banco de Chile fell Friday after the bank issued a statement saying that talks with Citibank had been brought to an end. The Chilean bank had been negotiating a possible strategic alliance with the US giant.

Brazil’s inflation, as measured by IPCA, ended the year at 3.14%, the lowest in almost a decade and among the lowest in the region in 2006. The rate was also well below the government’s target of 4.5%. The low rate means that the Central Bank has plenty of room to continue cutting the benchmark Selic rate at its next policy meeting on January 24. Inflation last year also fell significantly against the previous year: in 2005 prices rose by 5.69%.

State-run power company Companhia Energética de São Paulo (CESP) is planning to issue $330 million-worth of IPCA-linked bonds due 2015 to prepay outstanding debt due 2008 and 2011. Standard Bank is the sole bookrunner. The issuance is part of a larger medium-term note (MTN) program of up to $975 million. Moody’s Investors Service has assigned the notes a Ba3 foreign currency rating.

Brazil’s Camargo Correa Desenvolvimento Imobiliário, the real-estate unit of local conglomerate Camargo Correa is planning an IPO via Bovespa to join the burgeoning real estate sector listing on the exchange. The company is planning to sell up to 36 million common shares at an expected price of between 12.00 reais and 16.50 reais per share ($5.6-$7.8). Trading is due to start on January 31. Shares will be sold in Brazil and also to qualified investors in the U.S. under rule 144A in the form of global depositary shares. Credit Suisse will lead.

Mexican mining company Autlán, in a filing with the Mexican Stock Exchange, said it had issued $30 million in notes due 2012. It plans to use the money to pay down existing liabilities and improve its debt profile. The five-year notes will pay a fixed rate of 9.25% and will carry a two-year grace period. The transaction was coordinated by BCP Securities.