Banco do Brasil SA, Latin America’s biggest lender by assets, may raise as much as 12.2 billion reais ($6 billion) in an initial public offering for its insurance unit that would be the region’s largest since 2009.
BB Seguridade Participacoes SA plans to sell as much as 675 million of its existing voting shares, according to a statement published today in the Folha de S.Paulo newspaper. The Brasilia-based company estimates the price will be 15 reais to 18 reais.
The IPO would be the largest in Latin America since July 2009, when Banco Santander Brasil SA, the local unit of Spain’s largest bank, raised $7.5 billion, according to data compiled by Bloomberg. Banco do Brasil and four other Brazilian companies have announced IPO plans after Linx SA, a communications technology provider, completed the country’s first initial offering in nine months in February.
“BB Seguridade’s IPO will give even more capital room to Banco do Brasil,” the bank’s chief executive officer, Aldemir Bendine, 49, said in an interview in Brasilia today. He said the bank may make acquisitions in the U.S. and Latin America.
Banco do Brasil is one of the top candidates to buy City National Bank of Florida’s 26 branches from Spanish lender Bankia SA, according to four people with knowledge of the matter. Final bids are due in three to four weeks, said the people, who asked not be identified because the negotiations are private. Bendine declined to comment today on the talks. A Bankia spokesman also declined to comment.
Banco do Brasil offered 2 billion reais to buy an additional 25 percent stake in Banco Votorantim, Folha de S.Paulo reported today, citing an unidentified person. The state-controlled bank already owns about half of Votorantim’s voting shares. A Banco do Brasil spokesman didn’t return an e-mail seeking comment on the report.
Banco do Brasil declined 2.2 percent to 27.05 reais at the close of trading in Sao Paulo, compared with a gain of 1.2 percent for the benchmark Bovespa index. The stockclimbed 24 percent since Nov. 26, when it announced plans for the unit’s IPO, through yesterday.
BB Seguridade plans to price the shares on April 23 and start trading on the Sao Paulo exchange two days later, according to the statement. Banco do Brasil’s investment-banking unit is managing the offering. BB Seguridade controls all Banco do Brasil’s insurance business, including joint ventures with Madrid-based Mapfre SA.