Chilean Builder Set for IPO

After closing books Thursday, Chile’s Echeverria Izquierdo is set to emerge with a price today for its IPO expected to raise $100m-equivalent. The construction and engineering firm is planning to sell 151.3m shares, or a 25% stake post-float, to fund concessions, projects and expansion into new markets. “Its new businesses have attractive margins. However, there is execution risk that could mean a reduction in expected earnings,” CorpGroup says in a research report. The shop sees fair value at CLP315 per share, which would suggest a CLP47.66bn ($98m) deal size. CorpGroup also notes an adequate finance structure, low levels of indebtedness, along with a selective diversification of projects. With 34 years in operation, the builder is mainly in Chile and Peru, with a small presence in Argentina and has set up operations this year in Brazil and Colombia. As of December, 49% of its projects were in construction and civil engineering, 44% in industrial construction and 7% in real estate. It began meeting investors in Chile and Peru last month. IMTrust is managing the sale, seen as the region’s last equity sale before the September-October period.