Sura Set to Test Colombia ECM Mettle

With follow-ons from blue chips such as Empresa de Energia de Bogota and Davivienda filling their books, Colombia’s equity market is set be tested with a large deal from Colombia’s Grupo de Inversiones Suramericana. The financial conglomerate has filed to sell 120m shares, which would raise COP4.07trn ($2.19bn) at Friday’s COP33,900 closing price. Details on sale price and opening date for the offer could be announced as soon as today. The challenge, local bankers say, will be offering buyers enough of a discount while still reaching the large size the company needs to help fund the EUR2.615bn ($3.76bn) acquisition of ING’s LatAm pension fund and insurance assets agreed earlier this year. “It’s a great company, but a tricky equity story,” says a banker away from the deal. Sura will sell non-voting preferred shares paying a 3% dividend, which bankers say may also represent a challenge given the deal’s large size. A series of well-received follow-on sales in the Andean nation at a time when other countries remain shut to new issuance suggests there is appetite for high-quality Colombian issuers. Sura CFO Andres Bernal Correa told LatinFinance in August that BBVA, Deutsche Bank, HSBC, JPMorgan, Santander and UBS and Corredores Asociados had been hired to lead the deal, a third of which was expected to go to international investors.