* Taesa, shareholders may sell up to 27.000 units in IPO
* Suggests price of 60 reais to 70 reais a unit in deal
* Comes as initial share sales remain stagnant in Brazil
July 3 Transmissora Aliança de Energia Elétrica,
a unit of power holding company Cemig, plans to raise
up to 1.89 billion reais ($955 million) in an initial public
offering as risk aversion eases, increasing the appeal of
energy deals in Latin America's largest economy.
Rio de Janeiro-based Taesa, as the company is known, and
shareholders including Cemig and investment fund FIP Coliseu,
agreed to sell 20 million units - a blend of one common share
and two preferred shares - as part of the offering, according to
a newspaper announcement on Tuesday.
The offering could be increased by 7 million units in the
form of supplementary and additional lots, the announcement
said. The company will suggest a price per unit to investors of
between 60 reais and 70 reais for the IPO.
So far this year, only three Brazilian IPOs have
successfully priced - a sign of massive caution with the
once-hyped market. Pricing of the Taesa deal is expected by July
18, the same day that global commodities firm Louis Dreyfus Corp
hopes to float its local sugar and ethanol unit
Biosev in a $548 million IPO.
Currently there are six companies, including energy
companies Biosev and Taesa, filing for IPOs in Brazil, which is
also an indication that deals in the sector may attract the
attention of international investors. Shares for the three
companies that sold shares this year are trading below or near
their IPO prices.
IPOs, seen for most of the last decade as a symbol of
Brazil's buoyant capital markets, have languished the past two
years as prices sank for many names that went public. While most
markets have gradually recovered from the global financial
crisis of 2008, IPOs remain out of favor.
The trend underscores how investors in Brazil are still
reluctant to take on risky bets like IPOs, the mechanism that
small and sometimes inexperienced companies use to raise
capital. Instead, investors are more willing to pour money into
existing equity and bonds, where it is easier to assess risks.
Taesa hired the investment-banking units of BTG Pactual
, Goldman Sachs Group, Banco Santander
, Banco do Brasil and Bank of America
Merrill Lynch to manage the transaction.