Taesa Sees Strong Demand

As of Wednesday afternoon, Brazil’s Transmissora Alianca de Energia Eletrica (Taesa) had received about 3x demand for its equity sale scheduled to price today, according to people following the transaction. In the “re-IPO” sale, the Cemig-controlled transmission operator is targeting about BRL1.5bn ($739m), based on a base offer of 20m units at the midpoint of a BRL60.00-BRL70.00 range, plus a 15% greenshoe. A 20% hot issue is also available. A unit consists of one ordinary and 2 preferred shares. Working in Taesa’s favor its status as a known entity – its shares are listed, but are illiquid enough for the sale to be priced as an IPO rather than a follow-on – its dividends and a more favorable regulatory environment compared to others in the Brazilian electric sector, according to investors. The proceeds will be used for investments and expansion. Bank of America Merrill Lynch, BTG Pactual, Banco do Brasil, Goldman Sachs and Santander are managing the sale.