Credit Suisse calculated shares of Barueri, Brazil-based Redecard to be worth from 34.66 reais to 38.12 reais, according to a regulatory filing today. Sao Paulo-based Itau, Latin America’s biggest bank by market value, offered 35 reais on Feb. 7 to buy out Brazil’s second-largest card-payment processor and delist it from the Sao Paulo exchange.
Lazard Asset Management LLC, which owns 10 percent of Redecard, requested a second appraisal in April, arguing that the first, by NM Rothschild & Sons Ltd., undervalued the company. Rothschild’s appraisal valued the stock at between 34.18 reais and 37.59 reais, according to an April 5 regulatory filing by Redecard. The bank achieved the range using a free- cash-flow calculation and another one based on the share price of Cielo SA (CIEL3), Redecard’s larger competitor.
Itau, which is Redecard’s largest shareholder with a 50 percent stake, has said it won’t raise its bid even with a higher appraisal by Credit Suisse, and may give up its buyout plan entirely, according to an April 30 filing. Lazard is the second-biggest investor.
Redecard fell 1 percent in Sao Paulo since Itau announced the offering, compared with a gain of 22 percent for Cielo. Brazil’s benchmark stock index dropped 14 percent in the same period.
Redecard and its shareholders raised 4.07 billion reais selling 150.8 million stocks at 27 reais each in an initial public offering in July 2007. In March 2008, Citigroup Inc. sold 40.69 million Redecard’s stocks at 26 reais each in a public offering of 1.06 billion reais. The New York-based bank sold another 82 million Redecard’s shares at 24.50 reais each, raising 2.01 billion reais, in March 2009.
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