Gafisa SA rose the most in five weeks after newspaper Valor Economico reported that the homebuilder received offers for its Alphaville Urbanismo unit that exceed the entire company’s market value.
Shares rose 6.7 percent to 4 reais at the close of trading in Sao Paulo, the biggest gain since Feb. 22. Trading volume was twice the three-month daily average, according to data compiled by Bloomberg. The benchmark Bovespa index rose 1.2 percent.
Gafisa, which had a market capitalization of 1.6 billion reais ($791 million) yesterday, has received four offers to purchase Alphaville that valued it as high as 1.9 billion reais, Valor reported, without saying where it got the information. The company is considering selling a stake or spinning the subsidiary off in an initial public offering as it struggles to improve profitability after earnings trailed estimates in six of the past eight quarters.
“Gafisa is trying to improve its operations, and part of its restructuring plan is to reap the gains from the investment in Alphaville,” Felipe Rocha, an analyst at brokerage Omar Camargo, said by phone from Curitiba, Brazil. “That’s very good for the stock, considering the prices the media says people are offering for it. Rumors have circulated for more than six months, and the deal has not been sealed yet because the company is not sure it should let go of such a valuable asset.”
The four groups that bid for Alphaville, according to Valor, are the real estate fund Hemisferio Sul Investimentos; a partnership between billionaire Sam Zell’s Equity International and GP Investimentos; Patria Investimentos in partnership with Blackstone; and the private equity fund VBI Real Estate.
Gafisa, Hemisferio Sul, Patria and Blackstone declined to comment when contacted by Bloomberg News. Equity International, GP and VBI didn’t respond to requests for comments.
Alphaville builds higher-priced houses and apartments. It accounted for 31 percent of Gafisa’s 920.9 million reais revenue in the fourth quarter of 2012, according to a statement on the homebuilder’s website. The unit was registered as a public company on March 28.
Gafisa’s shares declined 15 percent this year while the Bovespa slid 8.8 percent.