Oct. 5 (Bloomberg) -- Shareholders of Bovespa Holding SA, the company that owns the Sao Paulo stock exchange, plan to raise as much as 4.63 billion reais ($2.5 billion) in a stock offering, which could be Brazil's biggest share sale in three years.

Bovespa, which in August became a for-profit organization in order to sell shares to investors, will offer 250.5 million existing shares, according to a statement published in Valor Economico newspaper. The company expects shares to be priced at 15.5 reais to 18.5 reais in the offering.

``With the drop in interest rates in Brazil the equity market will become more and more important as a destination for people's savings,'' said Vinicius Silva, an emerging market strategist for Morgan Stanley in New York. He said he could foresee more companies listing on the market.

Trading on the Bovespa, which was founded in 1890, has surged as falling interest rates have made investment in government bonds less attractive. Average daily trading at the Bovespa has soared to 6.68 billion reais this month from 2.43 billion reais in 2006 and as little as 747 million reais in 2000.

The initial public offering would add the Bovespa to 22 publicly traded exchanges around the world, according to Bloomberg data. Over the last three years at least nine stock exchanges have converted to public ownership, including the New York Stock Exchange and Spain's Bolsas y Mercados Espanoles. Mexico's stock exchange and its shareholders may sell as much as $500 million worth of stock to the public as soon as November, President and Chairman Guillermo Prieto Trevino said on Oct. 2.

Improved Earnings

The local investment-banking units of Credit Suisse Group and Goldman Sachs Group Inc. are managing the sale. The stock is scheduled to start trading on Oct. 26, according to the statement in Valor.

Earnings at Bovespa would improve as trading rises, Silva said. The bourse's operating revenue rose 45 percent in 2006 from the previous year to 310 million reais, according to the exchange's Web site. The exchange's profit doubled in 2005 from a year earlier, and increased another 52 percent to 200 million reais for 2006.

The Bovespa listed 390 companies as of September, including Petroleo Brasileiro SA, Brazil's state-controlled oil company, and Cia. Vale do Rio Doce, the world's biggest iron-ore producer. The value of listed companies has risen more than five-fold since 2000 to $1.2 trillion.

Bovespa's share sale would be larger than the July initial public offering of credit card company Redecard SA, which raised 4.64 billion reais, and is the biggest since 2004, when the stock exchange began compiling records for share sales.

To contact the reporter on this story: Telma Marotto in Sao Paulo at at tmarotto1@bloomberg.net; Guillermo Parra-Bernal in Sao Paulo at gparra@bloomberg.net

Last Updated: October 5, 2007 14:12 EDT