Well-Bid Cemex Sale Tilts toward Internationals

Cemex placed about 85% of the shares sold in the COP2.09trn ($1.15bn) Colombian IPO of the Cemex LatAm unit with international investors and 15% with Colombians, Bolsa y Renta says in a report. The carve-out of the Mexican cement maker’s assets in Colombia, Panama, Costa Rica, Brazil, Guatemala, Nicaragua and El Salvador saw nearly 3x demand. The cement maker priced 170m shares, including a 15% greenshoe, Tuesday at COP12,250 per share, the middle of a COP11,000-13,500 range. The deal was upsized from an initially expected 126m shares. The price implies a EV/2013 Ebitda of 9.5x, Bolsa y Renta says, suggesting 16% upside to the shop’s COP14,250 target price. 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. Cemex LatAm will use the net proceeds to repay debt to Cemex, which will use it for general corporate purposes, including the repayment of existing indebtedness. Bank of America Merrill Lynch, BBVA, Citi and Santander managed the sale, which represents close to a 30% float. The deal comes as part of a plan to sell assets to meet debt payments.