RIO DE JANEIRO, BRAZIL – After rehearsing a larger IPO early this year, Unicoba has resumed plans and now intends to raise R$450 (US$85) million in the coming weeks, in a fully primary offering that may mark the debut of a battery manufacturer on the Brazilian stock exchange.
The company has plants in Manaus (AM) and Extrema (MG), and has returned to the stock market with a restricted bid with three anchor investors guaranteeing part of the operation.
Founded in 1973 by Korean immigrant Young Moo Park, Unicoba operates on two fronts, batteries and LED lighting, both focused on the transition and energy efficiency fronts.
On the battery front, the company is strong in the market for portable components, such as cell phones and computers, but in recent years it has also been expanding its operations to an increasingly promising segment: storage for the electrical sector.
Its lithium batteries are used to provide stability to intermittent renewable systems, such as solar and wind power, which are rapidly growing in the energy matrix. In addition, there are models that enable the adoption of renewable sources in isolated systems in Brazil, which today are highly dependent on diesel and fuel oil generators.
On the lighting front, Unicoba claims to be a leader in LED solutions in the B2B market, both in the commerce, industry, and services sectors and in infrastructure, with its lighting for public roads, including highways.
The two units operated separately, but merged into a holding company in 2019 to capture synergies, particularly in business.
In addition to the founder and his son and CEO Eduardo Park, who together own 62% of the company, Unicoba’s shareholders include GEF Capital Partners, a manager focused on climate solutions with a 19.15% stake, and managers Confrapar (7.86%) and Performa/BNDES (5.67%).
Unicoba posted revenues of R$723 million in 2020, 53% more than the previous year, with a loss of R$5 million. In the first half of this year it posted R$378 million in revenues, up 39.5% over the same period in 2020, and closed the year in the black, with a profit of R$7.9 million.
In preliminary market surveys, the company has been testing a valuation around 10 times EBITDA (already considering debts) – below the multiple of 20 times that other equivalent international companies have been negotiating abroad.
Despite the model pleasing investors, the size of the offer is a restraining factor for some managers. “It is a well-managed company in a promising sector. But in a small offering, of R$450 million, and with anchors, those who enter will not leave as soon because of liquidity,” said an analyst from a management company that took part in preliminary meetings.
Bradesco BBI, BofA Merrill Lynch, BTG Pactual and XP Investimentos are coordinating the operation.