Brazil's T4U IPO delayed as rout hampers interest, sources say

lunes 6 de octubre de 2014 19:10 GYT
 

SAO PAULO Oct 6 (Reuters) - Brazilian cellphone tower operator T4U Holding Brasil SA delayed the pricing of a 500 million-real ($206 million) initial public offering for a month as concern over the nation's presidential election hampered sentiment ahead of investor meetings, two sources with direct knowledge of the deal said on Monday.

T4U scrapped the IPO's launch before the end of regulatory deadlines, meaning it will have to file an amended prospectus and wait until late November or early December to price it, said the first source, who declined to be identified since the deal is in the works.

Pricing of the T4U IPO was initially expected around Oct. 16. T4U, which is controlled by Israel's Fishman Group, hired Bank of America Merrill Lynch, Itaú BBA SA, UBS AG and Citigroup Inc to manage the deal.

A rout in Brazilian equity and currency markets last month spooked potential investors as President Dilma Rousseff overtook market-friendly candidates in opinion polls, the second source said. Rousseff won a first-round vote on Sunday, with a much smaller-than-expected lead over center-right candidate Aécio Neves. Both will face off in a runoff Oct. 26.

Efforts to contact T4U representatives for comment after working hours were unsuccessful.

The IPO plan comes at a time when operators such as American Tower Corp expand in Brazil and demand for high-speed internet spurs the construction of thousands of towers. Mobile phone carriers are selling towers and instead leasing them to preserve cash and profits in a flagging economy.

The delay in the T4U deal comes as JBS SA, the world's largest meatpacker, put off an IPO of its pork, poultry and food-processing operations in Brazil in September. JBS bankers were wary that election-related volatility could trigger significant pricing discounts.

Veterinary products maker Ouro Fino Saúde Animal Participações SA wants to raise up to 363.5 million reais from investors in an IPO expected for Oct. 17. The Ouro Fino IPO could be the first in the country this year.

($1 = 2.428 Brazilian reais) (Reporting by Guillermo Parra-Bernal)