InterCement looking at IPO of up to US$1 billion in Brazil

RIO DE JANEIRO, BRAZIL – InterCement has hired banks for an initial public offering (IPO) of its operation in Brazil, which aims to raise between US$500 million and US$1 billion, according to sources close to the matter.

The cement maker is working with Bradesco BBI, Itaú BBA, UBS BB Investment Bank, JPMorgan Chase and Bank of America on a potential IPO on B3 exchange, sources said, asking not to be identified because the information is not public.

InterCement raised the possibility of an IPO of its Brazilian operations in its fourth-quarter 2020 earnings report, saying at the time that it would retain control of the unit. Decisions are ongoing and there is no certainty that they will result in a listing, according to sources.

An InterCement representative declined to comment. Itaú, Bank of America, JPMorgan, Bradesco and UBS BB representatives declined to comment.

The IPO would be part of the effort to restructure InterCement’s debt, which last year deferred payments on US$900 million in loans until 2023, according to a Fitch Ratings report.

It would also coincide with a recovery in cement sales, as historically low interest rates and an increase in home renovations during isolation in the pandemic have fueled the building sector. In the 12-month period through March, 62.9 million tons of cement were sold in the country, a 15% increase over the previous year, according to the National Cement Industry Union (SNIC).

Another company that seeks to take advantage of the sector’s growth is LafargeHolcim, the world’s largest cement manufacturer. The Franco-Swiss company has hired Itaú for the sale of its Brazilian unit, which may be valued at up to US$1.5 billion, Bloomberg News reported last week.

Source: Moneytimes

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