Minerva Convert Uncertain Amid Market Pain

The fate of a convertible debenture sale from Brazil’s Minerva was unclear Wednesday evening, after the issuer extended the bookbuilding period by one day and sought to set a price Wednesday night, targeting BRL300m. The results were expected by this morning for what has been touted as the Brazilian market’s first-ever public sale of mandatorily convertible debentures, which was heard struggling to fill order books as risk markets continued to sour. “In this market nothing is getting done. There is zero international money going into Latin America,” says an ECM banker away from the deal. The volatility is due not only to concerns about debt problems in the US and the euro-zone, but also to increased worries about the domestic picture in Brazil, he adds. Equity transactions from Copersucar and Union Agriculture Group have been pulled in the last week, and Abril Educacao priced below its range. Minerva is looking at a reoffer price of between 97.00-103.00 of face value, with the interest rate and conversion price range established prior to bookbuilding. The bonds are to pay interest at 100% of DI, with the minimum and maximum conversion prices set at BRL6.00 and BRL8.00, respectively. Proceeds are marked for the repayment of existing debt, and for working capital. Minerva is rated BBB minus on a national scale. Goldman Sachs, Deutsche Bank and Banco do Brasil are leading. Officials at the company and the lead managers did not comment or did not return requests for comment Wednesday.