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Banco BMG to launch IPO of preferred shares worth 2B reais

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Banco BMG to launch IPO of preferred shares worth 2B reais

Banco BMG SA aims to obtain an estimated 2 billion reais from its initial public offering of up to 161.9 million preferred shares, the Brazilian lender said in an Oct. 4 prospectus.

The base offering involves a primary tranche of 103,448,277 new preferred shares and a secondary offering of 16,491,755 preferred shares, with an indicative price range between 11.60 reais and 13.40 reais per share. Additional lots could raise the offering to the aforementioned amount of shares.

The IPO will be priced Oct. 24, with Banco BMG organizing a roadshow for investors and a book-building period from Oct. 7.

Banco BMG will offer the shares both to investors in Brazil and internationally, with XP Investimentos Corretora de Câmbio Títulos e Valores Mobiliários SA, Banco Itaú BBA SA, Banco de Investimentos Credit Suisse (Brasil) SA, Brasil Plural SA Banco Múltiplo and BB-Banco de Investimento SA, and their foreign subsidiaries, serving as agents and coordinators.

The São Paulo-based lender has evaluated different alternatives to raise funds through the capital market since it withdrew from a planned IPO earlier in 2019.

According to previous media reports, Banco BMG considered going public in 2007 and 2010, but did not reach the point of hiring coordinators on either of those occasions.

More recently, the company was looking to raise between 1.50 billion reais and 2.00 billion reais through an IPO planned for December 2018. The bank set an indicative price range of between 11 reais and 14 reais per share, but it suspended the IPO after demand fell short of expectations.

As of Oct. 4, US$1 was equivalent to 4.05 Brazilian reais.