Linx Raising as Much as 527.9 Million Reais in IPO

Linx SA, a Brazilian information technology company, is raising as much as 527.9 million reais ($265.1 million) in an initial public offering that is the country’s first in nine months.

The voting shares are being sold at 27 reais each, the Sao Paulo-based company said today in a statement. Linx, which provides communications technology and management software for retailers, had expected to price the shares in a range of 23 reais to 27 reais, according to a Jan. 18 prospectus. The company is selling 12.7 million of new shares and previous shareholders including Brazil’s development bank BNDES are selling a further 6.84 million.

Linx’s IPO is Brazil’s first since furniture-maker Unicasa Industria de Moveis SA raised 425.6 million reais in April. Edemir Pinto, chief executive officer of exchange operator BM&FBovespa SA, has said he expects 2013 to bring an increase from the three IPOs held in 2012. There were 27 offerings in the three previous years.

“The environment is definitely not of euphoria like a couple of years ago,” Lucas Brendler, who helps manage about 6 billion reais ($3 billion) of assets at Banco Geracao Futuro de Investimentos, said by phone from Porto Alegre, Brazil. “Investors are much more selective and paying attention to details of the businesses and the risk they offer.”

Policy makers led by central bank President Alexandre Tombini kept the target interest rate unchanged at 7.25 percent for a second straight meeting on Jan. 16. Brazil will hold the benchmark Selic steady for a “sufficiently prolonged” period, the monetary authority said in minutes to that meeting released on its website on Jan. 24.

Postponed Offerings

Six Brazilian companies withdrew or postponed IPOs last year as Latin America’s largest economy struggled to boost its recovery, data compiled by Bloomberg show. Gross domestic product probably expanded 1 percent in 2012, about half the pace of the U.S. and Japan, according to economists surveyed by Bloomberg.

Estacio Participacoes SA, Brazil’s second-largest publicly traded university operator by revenue, raised 768.7 million reais in a share offering on Jan. 23. The company was planning to raise as much as 623 million reais in the share sale, it said in a Dec. 3 prospectus.

Linx had announced plans for the IPO in a regulatory filing in December. The stock will be listed in Bovespa’s Novo Mercado section, in which only voting shares may trade and at least 25 percent of a company’s stock must be available for trading. The stock starts trading on Feb. 8.

(Corrects first and third paragraphs in story published Feb. 6 to say previous Brazil IPO happened in April.)
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