Brazil’s equities market is anticipating a busy September with two initial public offerings set to launch in the coming weeks, LatinFinance understands.
Reinsurer IRB Brasil Re filed its IPO late last month and one equities source close to the deal is confident that it will launch by the end of this week, after the US Labor Day holiday. The offering, which is due to price by mid-October, could raise up to $1bn, a second ECM banker told LatinFinance.
JPMorgan is the global coordinator and bookrunner on the IPO. Banco do Brasil, Bank of America-Merrill Lynch, Bradesco, Brasil Plural, BTG Pactual and Itaú BBA are the other bookrunners.
Caixa Seguridade Participações, the insurance arm of bank Caixa Econômica Federal, is due to launch its IPO this week, one source close to the deal said. Bankers on this deal are confident it can raise up to $1.3bn and price by mid-October.
Banco do Brasil and UBS are the lead underwriters and bookrunners on the Caixa deal. Bank of America-Merrill Lynch, Bradesco, Brasil Plural, BTG Pactual, Citi, Goldman Sachs, Itaú BBA and Santander are said to be working on this deal.
Despite a falling Brazilian real and difficult macroeconomic conditions, bankers remain buoyant about these two deals, which are both set for extensive global roadshows.
Both offerings are courting investors from New York, Brazil, Europe and the Middle East. One source added that investors from Singapore have also expressed interest.
After a slow August, a flurry of deals is due to launch in the next two months across Latin America and the Caribbean.
While the market remains upbeat over these two deals, Brazil third IPO – Petrobras’ BR Distribuidora – has been delayed to Q1 2016, a source close to the deal said.
The company will be evaluating a corporate restructure and appoint a private partner to implement more “transparent policies”, he said. Bankers are confident however that the BR Distribuidora deal will follow through as an IPO and not a strategic private sale. LF