Fras-le moves ahead with follow-on to fund acquisitions

A follow-on equity sale for Brazilian vehicle part maker Fras-le could raise BRL247.6m to BRL294.3m, excluding greenshoe or hot issue allocations. The firm plans to use the funds for acquisitions, either in Brazil or abroad. The firm said on Friday that it expects to price the deal at BRL5.3 to BRL6.3 per share. It is offering 34.5m primary shares, and six shareholders are offering 12.2m in a secondary offering. Shareholders participating in the secondary sale are pension funds Previ and Petros which hold 22.5% and 8.48% of the firm, respectively, three Maua investment funds (5.25%), and VBI, another fund (0.66%). After the sale, if the overallotment allocations are not used, Previ will hold 11.2%, Petros, 4.22%, Maua, 2.83%, VBI 0.09%. The Randon group is Fras-le’s largest shareholder, holding 46.3% of the firm. It has agreed to pick up at least 45.1% of the shares sold, which will give it a 50.1% stake after the sale. Banco Votorantim and Santander have been hired to manage. The specialist in brake parts exports to about 80 countries and reported Ebitda of BRL84.9m in the 9 months to September 30. Fras-le’s shares, which trade in low volumes, closed at BRL5.65 on Monday. The deal is scheduled to be priced on February 7.