Daily Management Review

Sweet Taste For Carrefour, Biotoscana Left By Big Week For Brazil IPOs


07/24/2017




Sweet Taste For Carrefour, Biotoscana Left By Big Week For Brazil IPOs
As a nascent economic recovery and the passage of key economic reforms helped to lure global investors, the busiest week for initial public offerings in Brazil in four years ended last week end on an upbeat note for issuers.
 
In a Friday IPO, 1.34 billion reais ($426.7 million) was raised by Grupo Biotoscana SA, a Colombia-based pharmaceutical firm, and shareholders. Added to this was the raising of 5.12 billion reais by the IPO of Brazil's biggest diversified retailer Grupo Carrefour Brasil SA three days earlier.
 
The IPOs of loyalty program Smiles SA and insurer BB Seguridade Participações SA had raised 12.6 billion reais on April 25, 2013, and last week was marked as the busiest week for the Brazilina markets for local equity offerings since that last IPO offering.
 
Suggesting resilient lawmaker support for his reform agenda despite the nation's political crisis, Brazilian President Michel Temer plans to revamp labor regulations cleared Congress before its winter break and it is amidst that optimistic business and local economic environment that the Brazilian stocks .BVSP and its currency BRBY have outperformed Latin American peers in recent weeks.
 
"With the labor reform approved and Congress in recess, there's a window of opportunity for companies looking to seize on demand for Brazilian equities," said one fund manager who participated in the Carrefour listing.
 
Shares of renewable power firm Omega Geração SA and reinsurer IRB Brasil Resseguros SA are scheduled to debut on the São Paulo Stock Exchange in coming weeks and last week’s successful transactions spell good news for both the companies.
 
Bankers said that Temer's ability to garner support for an ambitious pension code reform when Congress returns in August would be partly responsible for the extension of the current wave of IPO offerings.  
 
And as Brazil slowly emerges from recession against the backdrop of escalating corruption allegations against Temer, companies seeking to tap local equity markets needed to balance risks and returns, bankers said.
 
Foreign investors have traditionally the main buyers of Brazilian IPOs and they have bene forced to remain on the sidelines due to the recent uncertainty in Brazil.
 
Data showed that compared with the 67 percent over the previous decade, before this week, foreigners snapped up just 54 percent of Brazilian IPOs this year.
 
And suggestions and indication that the uneasiness may be starting to abate were available as most buyers in the Biotoscana listing were foreign institutional funds, reported the media quoting people with knowledge of the deal.
 
Investors are wary of IPOs in Brazil as they were stung by a string of deals in recent years that failed to deliver promised returns.
 
Thomson Reuters data showed that returns above Brazil's interbank lending rate was delivered by less than one-third of the 115 IPOs priced since the start of 2007.
 
(Source:www.reuters.com) 






Science & Technology

With China Set To Dominate, 1 Billion Could Be Using 5G By 2023

Deutsche Telekom unveils next gen 5G mobile antennas in Europe

Diamonds are now the new gold

Expert Body Says Driving In A Driverless Car In An Inebriated Condition Or On Drugs Should Be Legalized

SEC’s EDGAR database vulnerable to cyber threats

Research Says The Risk Of Severe Turbulence On Planes Will Increase Due To Climate Change

Barclays and CLS Group aim to replace SWIFT with blockchain

Designing Of Cars Being Done With Hologram Goggles At Ford

The Already Surging Cyber Attacks Are Set To Rise Even Further, Says A Study

Chinese to equip smartphones with OLED displays

World Politics

World & Politics

Scholar Says Political Appointees Not As Important As Financial Ones In China For The Economy

An Expected Change In Brussels Could Be Crucial For The Euro Zone

Destroying People Who Wouldn't Help One Of His Bankrupt Businesses Was All Trump Talked About When He Met Him In 1990s: Branson

Russia Is Worried About America’s Unpredictability

No oil contracts with Iraqi Kurdistan: Iraq’s oil ministry

Donald Trump lost $ 600 million during his presidency

Britain puts its weight behind Europe in the battle between Boeing and Bombardier

EU hopes to keep the Iran nuclear deal afloat