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Carrefour’s Brazil unit targets jumbo IPO

Jul 11, 2017

The French retailer’s subsidiary could raise up to $1.7bn if it prices at the top of a suggested range

Aaron Weinman

Keywords: Carrefour Brazil IPO equity capital markets Atacadao Brazil

Carrefour Brazil, or Atacadao, could raise up to BRL5.6bn ($1.7bn) in an IPO scheduled for July 18 after bookrunners set a suggested price tag of BRL15 to BRL19 per share.

The French retailer is offering up roughly 297.14m shares in a primary and secondary sale of its Brazilian subsidiary, plus an overallotment of 44.57m shares, according to a securities filing.

Parent company Carrefour and the Diniz Family, through Peninsula Participacoes, will sell approximately 91m common shares, while the latter can also trigger an overallotment of 59m shares. About 205.88m shares will be sold in the primary portion of the IPO.

The shares will trade on the BM&FBovespa. An IPO inked at the top of the suggested range would value Carrefour Brazil at BRL37.6bn, according to equity capital markets sources.

Proceeds from the primary tranche would partially go towards potential expansion plans, one ECM banker told LatinFinance.

Carrefour Brazil’s IPO would be the largest since state-owned insurance company BB Seguridade raised BRL11.47bn in an offering back in April 2013.

Paris-listed Carrefour holds an 88% stake in Atacadao, while Peninsula has the remaining 12%, which the asset manager picked up in 2014.

Bank of America Merrill Lynch, Bradesco, Goldman Sachs, Itau BBA and JPMorgan are coordinating the trade.

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