* Qualicorp prices IPO at 13 reais/share, below range
* Company, shareholders raise 1.1 bln reais from IPO
* Rout in local stocks hampers interest in recent IPOs
(Adds details on pricing, share performance of rival Amil in
By Guillermo Parra-Bernal
SAO PAULO, June 27 Brazilian health services
provider Qualicorp (QUAL3.SA) priced its initial public
offering almost 32 percent below the suggested price range on
Monday, indicating that a sell-off in the local equities market
is hampering appetite for new stock.
Sao Paulo-based Qualicorp and shareholders, including U.S,
buyout firm Carlyle [CYL.UL], sold 83.47 million shares, or 85
percent of the total stock on offer, at 13 reais a share,
according to a regulatory filing. The transaction fetched a
total 1.09 billion reais ($680 million).
Qualicorp, which will be Brazil's only listed collective
health services provider, was seeking to price the offering in
a range between 16 reais and 19 reais. Including the additional
and supplementary lots in the offering, the company sought to
sell as many as 97.99 million shares.
The Qualicorp IPO is the latest in a series of setbacks for
Brazilian companies, which have seen their share offerings
either priced below expectations or suspended amid worries that
Latin America's biggest economy is showing signs of a bubble.
Some investors saw the offering as a litmus test of demand
for new equity in Brazil, where companies have raised about
$9.5 billion from stock investors this year.
Brazil's stock market has lagged its peers for most of the
year and is down 11.5 percent in the year to date.
This is the second time this year that buyout firms have
had trouble pricing their Brazilian IPOs. In March,
Boston-based Advent International's offering of shares in
restaurant operator International Meal Company IMCH3.SA
priced at the bottom of the proposed range. [ID:nN04141317]
Investors in the Qualicorp IPO had placed orders below the
suggested range, saying the shares were too expensive,
International Financing Review said earlier on Monday.
While the IPO was said to have been oversubscribed,
investors were concerned that the valuation was "too
aggressive," IFR quoted unnamed sources as saying.
While investors say healthcare is under-represented in the
Bovespa stock exchange .BVSP, they still see the industry as
a fast-growing bet. Shares of Amil AMIL3.SA, Brazil's biggest
operator of health plans for individuals and Qualicorp's only
peer in the local market, is trading at 9 times next year's
Amil tumbled 2.6 percent to 17.60 reais on Monday, while
the Bovespa gained 0.4 percent.
The company hired the investment banking units of Bank of
America (BAC.N), Credit Suisse Group CSGN.VX, Goldman Sachs
Group (GS.N), Barclays (BARC.L), Banco Bradesco (BBDC4.SA) and
Banco do Brasil (BBAS3.SA) to manage the deal.
Qualicorp was founded in 1997 as a health plan broker, but
only seven years later began implementing collective health
plans. Private equity giant General Atlantic acquired a 46
percent stake in the company in 2008; control of the company
was sold to Carlyle about a year ago.
Qualicorp mainly manages collective health plans for
professional and trade groups, and provides clients with
brokerage and consulting services related to corporate health
plans. The company also manages health risk for companies and
outsources services for self-managed health plans.
Qualicorp plans to use about 80 percent of the proceeds
from the IPO to acquire companies and health plan portfolios
from rivals, mainly in the collective affinity health plans
The remaining funds will be funneled into revamping the
company's software and information technology infrastructure
and other corporate purposes to bolster regional expansion.
In the IPO, Qualicorp raised 353.85 million reais through
the sale of 27.22 million shares in a primary offering. Carlyle
and shareholder Heraclito do Brito Gomes Jr. sold a combined
56.25 million shares in a secondary offering.
Carlyle originally planned to sell a portion of the 69
percent stake it owned of Qualicorp and for which it paid about
$1.2 billion last year.
The shares are due to debut on the Bovespa stock exchange
in Sao Paulo under the symbol "QUAL3" on June 29.
According to IFR, Carlyle's decision to partially cash out
of its position in Qualicorp will likely trigger an increase in
the company's book value, "giving the firm a paper gain."
(Additional reporting by Cesar Bianconi in Sao Paulo; Editing
by Robert MacMillan, Gary Hill)