Well-bid EDB FO Tops $500m

Energias do Brasil (EDB) has priced a BRL810.7m ($506m) follow-on equity sale, selling the secondary shares at just a 0.05% discount after generating some BRL3.2bn in demand. The 21.9m shares priced at BRL37.00 each versus a BRL37.21 closing price Thursday. The share total includes a 10% greenshoe. The stock rose 1.7% in Thursday’s session, despite a drop in the Bovespa and most other electricity stocks. EDB had seen a decline in its stock of almost 9% from announcement through to Wednesday’s close, but a rebound Thursday seemed to suggest a strong bid. Parent Energias de Portugal (EDP) is the selling shareholder, holding the sale as a part of a plan to raise EUR500m from assets sales this year as it looks to keep its debt levels under control. The Portuguese utility EDP reduces its 49.1% stake in EDB to 35.3%, with the free float increasing to 48.8% from 35.0%, according to data in the prospectus. Analysts have said the position in EDB was among the easiest for EDP to sell among its global assets. EDB operates hydroelectric and wind generation assets, as well as distribution companies. Banco Espirito Santo, Itau, Morgan Stanley and Santander managed the sale. Pricing was moved back from last week, a sensible move given how recent equity deals have struggled. The next Brazilian deals on the calendar are IPOs from Copersucar July 19 and Abril Educacao July 21.