Cemex LatAm Pours at Midpoint

Cemex has priced the IPO of its Cemex LatAm unit at the midpoint of its range, in an upsized deal that should raise more than $1bn-equivalent, according to people familiar with the sale. The Colombia-listed carve-out of the Mexican cement maker’s assets in Colombia, Panama, Costa Rica, Brazil, Guatemala, Nicaragua and El Salvador had a book heard to be at least 2x subscribed Tuesday, in a transaction that also offered a few firsts for a Colombian listing. The base deal was upsized to include 148m shares, from 110m, indicating a COP1.81trn ($999m) size at the COP12,250 per share price, the middle of a COP11,000-13,500 range. A greenshoe was also possible. The number of shares to be placed in Colombia versus internationally had not been disclosed Tuesday night. Both the setting of a price range and the division of shares into local and 144a tranches at the time of pricing are novelties for a Colombian ECM deal, where normally an issuer sets the geographic breakdown as well as a fixed price prior to an extended order period. “This is a positive step for equity transactions in Colombia,” notes a LatAm ECM banker away from the deal. Bankers also note the trend towards carve-outs in LatAm by both regional players and foreigners looking to unlock value from collections of assets. Debt investors’ enthusiasm for the Cemex recovery story appears to have carried over to the equity side, boosted by the carve-out including some of the company’s most attractive assets in high-growth markets. “Central America represents an opportunity for growth, due to the large infrastructure needs,” says a Mexico City-based equity analyst. Colombia accounts for 55% of Cemex LatAm’s sales, and Panama 19%. The base deal represents about a 27% float. Bank of America Merrill Lynch, BBVA, Citi and Santander managed the sale. The deal comes as part of a plan to sell assets to meet debt maturity payments. Cemex in September got creditors to extend to 2017-2018 more than $7.2bn in debt that had been du