Issuers Reopen Equity Market with $3bn Push

Encouraged by hints that a financing window may finally be creaking open in LatAm, five Brazilian companies will try to place up to $3bn in new equity over the next eight sessions. The ECM pipeline has been dormant for most of the year, but in the past days issuers have committed to pricing ranges and issue dates. “The market is not easy right now, but it is certainly not closed,” says an ECM banker with deals on the way. Issuers in general have until the end of April to tap the markets using December 31 numbers, which partly explains the upcoming glut. Markets have also calmed though they still offer limited long term visibility. “It’s really more the perception that markets have improved,” Will Landers, a portfolio manager for LatAm at BlackRock, tells LatinFinance. “Intraday volatility is still very high,” adds Landers, noting he is not convinced that all of the companies in the pipeline will succeed at their desired valuations. Hypermarcas is first up, hoping to price an IPO tomorrow at BRL20.50-BRL24.50 to raise the equivalent of $533m, including a greenshoe, according to Dealogic. If successful, the offering would be the first IPO of the year of substantial size, and could open the door for dozens of borrowers waiting in the wings. Citi and Merrill have books.