BTG IPO Heard Oversubscribed

Demand for BTG Pactual’s IPO is heard having passed the oversubscription point, ahead of pricing scheduled for Tuesday. The sale could raise BRL2.98bn-BRL3.49bn ($1.59bn-$1.86bn), depending on where it prices in a BRL28.75-BRL33.75 range. Though investors see a valuation as high as 3.0x book value, BTG has been describing the price range as implying a 2.2x-2.6x. The bank plans to sell 72m primary units and 18m secondary units, including a 15% greenshoe. The units each consist of one preferred and one ordinary share in Banco BTG Pactual, and one common and one non-voting common share in the BTG Pactual Participations offshore entity. The IPO will feature a Brazilian portion and an international portion done in Amsterdam. The secondary shares are to be sold by 5 investment vehicles representing the holdings of investment firm JC Flowers and the Rothschild, Agnelli and Motta families, who all bought into the bank through a 2010 private deal. Proceeds will go towards BTG’s expansion. BTG Pactual is global coordinator, with Bradesco, JPMorgan, Goldman Sachs, Citi and Banco do Brasil as joint bookrunners, and Morgan Stanley, Deutsche Bank and UBS as lead managers.