Brazil's JBS Foods pulls regulatory request, signaling IPO delay

martes 21 de octubre de 2014 09:12 GYT
 

SAO PAULO Oct 21 (Reuters) - JBS Foods SA pulled a request to become a publicly listed company in Brazil, signaling it may delay a plan to raise 4 billion reais ($1.6 billion) in an initial public offering until next year, a source with direct knowledge of the situation said on Tuesday.

The São Paulo-based food processor and banks working on the offer are wary that volatility stemming from uncertainty about Sunday's presidential election may cloud sentiment ahead of potential investor meetings in the coming weeks, said the source, who requested anonymity since the matter is private.

It is the third time that the unit of JBS SA, the world's largest meatpacker, has suspended the stock offering since June. Potential IPOs in the queue in Brazil include those of cellphone tower operator T4U Holding Brasil SA and heavy vehicle rental company Ouro Verde Locação e Serviço SA.

Representatives from JBS were unavailable. The company hired the investment-banking units of Bank of America Corp, Itaú Unibanco Holding SA, Banco Bradesco SA , Grupo BTG Pactual SA, Banco do Brasil SA , HSBC Holdings Plc and Banco Santander SA to oversee the transaction.

On Friday, veterinary products maker Ouro Fino Saúde Animal Participações SA's shares priced at the top of the suggested range after investor demand for Brazil's first IPO of the year was stronger than expected.

A number of pension funds and asset management firms that could be some of the JBS Foods IPO buyers voiced election-related worries to the company and bankers, the source said. Among the concerns were the effects of a victory by President Dilma Rousseff on risk perception, as well as reduced global liquidity and a domestic recession.

The benchmark Bovespa stock index tumbled 4 percent on Tuesday, the third decline in four days, after polls showed Rousseff with a slight lead. Opposition candidate Aecio Neves is seen as more business-friendly than Rousseff.

JBS Foods accounted for nearly 10 percent of JBS's $40 billion in revenue last year.

JBS aims to list JBS Foods on the São Paulo Stock Exchange's Novo Mercado, which has tougher corporate governance standards and requires that a company list at least 25 percent of its shares.

($1 = 2.4903 Brazilian reais) (Reporting by Guillermo Parra-Bernal; Editing by Lisa Von Ahn)