Bloomberg News

BTG’s IPO Said to Value Esteves’s Bank at $14.5 Billion

April 24, 2012

Banco BTG Pactual SA (BBTG11)’s initial public offering valued the Brazilian bank, led by billionaire Andre Esteves, at 27.3 billion reais ($14.5 billion), a person familiar with the transaction said.

The IPO was sold at 31.25 reais per unit, according to the person, who declined to be named because the details haven’t been made public. BTG had said previously it expected the price to fall in a range of 28.75 reais to 33.75 reais.

BTG’s IPO was the largest for an investment bank since Huatai Securities Co.’s $2.3 billion offering in Shanghai in 2010, and the company is the first stand-alone investment bank to go public in Brazil, according to data compiled by Bloomberg. Brazilian banks have benefited from a rebound in the benchmark Bovespa stock index this year and on signs Europeans may resume investing in emerging markets as the debt crisis there eases.

“I’m happy to take any sign as a positive these days, but I think it’s most apt to be peculiar to the Brazilian environment, and not so much an indication of how things are going worldwide,” Gary Townsend, head of Hill Townsend Capital LLC, which manages about $40 million, said in a phone interview.

The units, which represent a total of three shares of the bank and three shares of BTG’s private-equity firm, will begin trading in Sao Paulo and Amsterdam on April 26. BTG plans to use the proceeds to “continue expanding its businesses” and to improve its “funding structure,” according to a regulatory filing.

The bank’s IPO is the biggest in the Brazilian exchange, BM&FBovespa SA (BVMF3), since Banco Santander Brasil SA, a subsidiary of Madrid-based Banco Santander SA (SAN), raised a record 13.2 billion reais in October 2009. It’s the second IPO in Brazil this year.

Mexico’s IPO market is also showing signs of revival with the planned sale tomorrow of shares in Alpek SAB, the country’s largest privately owned petrochemical company. Alpek’s parent, Alfa SAB, is selling a stake to raise as much as 11.2 billion pesos ($850 million).

To contact the reporter on this story: Cristiane Lucchesi in Sao Paulo at clucchesi5@bloomberg.net

To contact the editor responsible for this story: David Scheer at dscheer@bloomberg.net


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