BB Seguridade Raises $4.25 Billion in World’s Biggest 2013 IPO

BB Seguridade Participacoes SA, the insurance unit of Banco do Brasil SA (BBAS3), is raising 8.5 billion reais ($4.2 billion) in the world’s biggest initial public offering this year.

The bank sold 500 million existing shares at 17 reais apiece, within the range of the Brasilia-based company’s forecast, the country’s securities regulator Comissao de Valores Mobiliarios said today on its website. The total sale may climb to as much as 11.5 billion reais including the overallotment option for underwriters. That values the insurer at 34 billion reais, almost half of Banco do Brasil’s market value of 73.8 billion reais.

BB Seguridade’s IPO is the largest this year, exceeding animal-health company Zoetis Inc.’s $2.57 billion sale in February, and the biggest in Brazil since July 2009, when Banco Santander Brasil SA raised $7.5 billion, according to data compiled by Bloomberg. BB Seguridade controls all Banco do Brasil’s insurance business, including joint ventures with Madrid-based Mapfre SA.

“It’s a very good price as this is a giant offering,” Rodolfo Amstalden, an analyst at consulting firm Empiricus Research in Sao Paulo, said today in a phone interview. “It is good we have new blood being listed at the Sao Paulo exchange.”

Banco do Brasil has climbed 20 percent since it announced plans for the IPO on Nov. 26. The benchmark Ibovespa index declined 4.5 percent in the period. BB Seguridade starts trading April 29 in Sao Paulo.

Banco do Brasil’s investment-banking unit is managing the offering with Banco Bradesco BBI SA, Banco BTG Pactual SA, Citigroup Inc., Itau Unibanco Holding SA’s Itau BBA, Brasil Plural SA Banco Multiplo, JPMorgan Chase & Co. and Banco Votorantim SA.

On April 12, Brazil’s securities regulator, or CVM, suspended the sale for 30 days citing “irregular publicity material.” The suspension was revoked April 16, delaying the pricing for two days from initial estimates.

To contact the reporters on this story: Francisco Marcelino in Sao Paulo at mdeoliveira@bloomberg.net; Cristiane Lucchesi in Sao Paulo at clucchesi5@bloomberg.net

To contact the editor responsible for this story: David Scheer at dscheer@bloomberg.net

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