Cementos Argos Finalizes Share Sale

Cementos Argos has completed the “second round” in the IPO of its preferred shares, allocating an additional COP209.42bn ($111m) to bring the total transaction size to COP1.611trn. The cement producing subsidiary of Grupo Argos sold 27m shares in the second round, it says, out of a possible 32m, at the same COP7,700 per share price that was set last month at the pricing of the first round – the low end of a COP7,700-COP9,300 range. Though both rounds, it sold 133m shares to local investors and 76m to international buyers in the form of ADR, and fell short of a COP2trn-plus target it originally planned. The deal was said to receive about 1.5x demand in the first round and was heard driven by existing shareholders, though Grupo Argos – owner of 60% prior to the sale – chose not to exercise its rights in the offer. The issuer plans to use 20% of the funds raised to repay debt, and the remainder for growth, with both organic and expansion and acquisitions possible. Bancolombia, JPMorgan and HSBC managed the sale, with Bank of America Merrill Lynch, Credit Suisse and Itau as bookrunners. The new preferred shares closed at COP8,150 Wednesday, and the older common shares at COP8,090.