Colombia’s Ecopetrol Readies up to $3bn EquityTap

Ecopetrol, Colombia’s state-owned oil company, will on August 27 begin to offer its shares to the public in a process that will yield an estimated $2.5bn-$3.0bn in equity. The company is looking to sell up to a 20% stake through an equity offering, part of a larger process to privatize state-owned companies. “A 10% stake would be worth around $2bn or $2.25bn,” Javier Gutiérrez, CEO of Ecopetrol, told LatinFinance on the sidelines of The Andean Investment Forum in Bogotá Tuesday. The offering will take place in three rounds. The first will be offered to stakeholders with special rights, such as labor syndicates, employees and current owners. The second will go to general retail and institutional investors in Colombia, and the third will be offered abroad. Local demand for the securities is estimated at $600m-$900m, according to bankers. The remainder will be offered abroad. Citi and Merrill Lynch have been hired to value the company for the offering, while Credit Suisse and JPMorgan will underwrite the deal, with Bancolombia acting as the local underwriter.