Linx Launches IPO

Linx, a Brazilian provider of software to the retail sector, has launched an IPO targeting at least BRL450m ($221m), with pricing scheduled for February 6. Following recent pre-education meetings, the issuer is looking to sell 19.6m shares, assuming a 15% greenshoe, at BRL23.00-BRL27.00 each, according to regulatory documents, raising BRL490m at the midpoint. The shares include 6m secondary shares to be sold by a private equity fund linked to Itau. Betting that a retail focus and solid growth story will overcome the usual investor doubts about smaller deals, Linx is seeking to raise funds for acquisitions and for working capital. BTG Pactual, Credit Suisse, Itau and Morgan Stanley are managing the sale. Linx booked BRL56m ($27m) in Ebitda in 2011, up from BRL40m in 2010. Linx offers both cloud-based and on-premises products for Brazilian retailers. It has been operating for 27 years and claims 29% market share.