Brazil's Ouro Fino IPO seen pricing at top of range -sources

viernes 17 de octubre de 2014 15:50 GYT

By Guillermo Parra-Bernal

SAO PAULO Oct 17 (Reuters) - Brazilian veterinary products maker Ouro Fino Saúde Animal Participações SA's initial public offering will price at the top of the suggested price range later on Friday, two sources said, as investor demand for the nation's first IPO of the year was stronger than expected.

The Cravinhos, Brazil-based company and some shareholders are offering 13.46 million shares at a price between 26 reais and 27 reais each. Ouro Fino estimates that almost 45 percent of its shares will be publicly traded should an extra 4.7 million shares be sold via additional and supplementary allotments.

The IPO could raise 363.5 million reais ($149 million) should it price at the top of the range.

Investors, led by a global private-equity firm and two domestic funds, placed bids equal to more than five times the number of shares available, said the first source, who declined to be identified since the deal is in the works. The second source indicated that Ouro Fino could price the deal "around the high-end of the range," near 27 reais.

The transaction is set to price between the first and second rounds of Brazil's most unpredictable presidential election in a quarter of a century, and comes after as JBS SA, the world's largest meatpacker, put off an IPO of its pork, poultry and food-processing operations in Brazil last month.

The last time a Brazilian company listed shares on the São Paulo Stock Exchange was in December, when travel agency CVC Brasil Operadora de Turismo SA raised 540 million reais. This year, IPOs in Brazil are likely to have their worst year in at least a decade.

Under terms of the transaction, Ouro Fino will sell as many as 1.923 million common shares in a primary offering, while a number of shareholders including BNDES Participações SA and controlling partners Norival Bonamichi and Jardel Massari will tender 11.54 million shares in a secondary offering.

In a primary offering, a company raises money from an IPO for its own use. A secondary offering allows shareholders to cash out from their investment in the company being listed.

Ouro Fino has hired the investment banking units of JPMorgan Chase & Co, Itaú Unibanco Holding SA, Banco Bradesco SA and Banco do Brasil SA to manage the deal.

($1 = 2.441 Brazilian reais) (Reporting by Guillermo Parra-Bernal; Editing by Nick Zieminski)