Arcos Raises $1.25 Billion in Expanded Initial Public Offering

Arcos Dorados Holdings Inc., the Buenos Aires-based operator of McDonald’s Corp. (MCD) restaurants in Latin America and the Caribbean, raised $1.25 billion in its expanded initial share sale, 33 percent more than it sought.

Arcos said in a statement yesterday it sold 73.5 million shares at $17 each. The company had offered 62.5 million shares at $13 to $15 apiece, according to a filing with the U.S. Securities and Exchange Commission. The deal received more than 10 times more orders than the amount of stock being offered, a person with knowledge of the situation said.

The fast-food chain is among seven companies attempting to raise a combined $1.89 billion in U.S. IPOs this week, the biggest number of deals in more than two months. Arcos and Zipcar Inc., the car-sharing company that rents vehicles by the hour, both increased the number and price of shares in their IPOs yesterday to meet investor demand.

“We’re moving toward traditional IPOs that have good growth characteristics,” said Timothy Cunningham, a manager at Santa Fe, New Mexico-based Thornburg Investment Management, which oversees about $78 billion. “That’s what investors want to see.”

The expansion of Brazil’s economy has helped Arcos more than quadruple net income since 2007, when it bought the McDonald’s Latin America business. Sales at the operator’s Brazil outlets surged 33 percent last year, outpacing a 13 percent jump for all of Arcos.

Zipcar Growth

Zipcar, based in Cambridge, Massachusetts, raised $174 million, 31 percent more than it sought. The company sold 9.7 million shares at $18 each, Bloomberg data show, after offering 8.33 million at $14 to $16.

The company operates in 14 metropolitan areas, including London, and has more than 8,000 cars. It plans to expand in the U.S. and international markets including Europe, according to its filing. Revenue increased more than sixfold to $186.1 million in the five years through 2010, the prospectus showed.

In other IPO news, Box Ships Inc., the international shipping company, and TMS International Corp., the provider of outsourcing services to steelmakers, both raised less than they sought, pricing their offerings below the proposed range.

Box Ships sold 11 million shares at $12 each, according to data compiled by Bloomberg. The Athens-based company had offered 10 million shares at $15 to $17 apiece. UBS AG of Zurich and Morgan Stanley led the offering, and the shares will trade on the NYSE under the symbol TEU.

TMS International

TMS International raised $145.6 million, pricing 11.2 million shares at $13 each. The Glassport, Pennsylvania-based company had offered 12.5 million at $15 to $17. Bank of America Corp., Zurich-based Credit Suisse Group AG and JPMorgan Chase & Co. led the offering. The shares will trade on the NYSE under the symbol TMS.

Arcos’s offering was led by Bank of America, based in Charlotte, North Carolina; JPMorgan, Morgan Stanley and Citigroup Inc. of New York; and Sao Paulo-based Itau Unibanco Holding SA. The shares will list on the New York Stock Exchange under the symbol ARCO.

Zipcar’s share sale was managed by New York-based Goldman Sachs Group Inc. and JPMorgan. The shares will be listed on the Nasdaq Stock Market under the symbol ZIP.

To contact the reporter on this story: Lee Spears in New York at lspears3@bloomberg.net.

To contact the editor responsible for this story: Jennifer Sondag at jsondag@bloomberg.net.

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