| SAO PAULO
SAO PAULO May 5 BR Malls Participações,
Brazil's largest mall operator, has hired banks to sell 1.7
billion reais ($536 million) worth of new shares in an offering
as early as next week, a person with direct knowledge of the
matter said on Friday.
Rio de Janeiro-based BR Malls has hired the
investment-banking units of Banco Bradesco SA, Itaú
Unibanco Holding SA, JPMorgan Chase & Co,
Banco Santander Brasil SA and Morgan Stanley & Co
to underwrite the so-called restricted-efforts offering,
which is limited to qualified investors, said the person.
BR Malls declined to comment. The banks did not have an
immediate comment on the primary offering in which all proceeds
from the transaction go to the company's coffers.
The person asked to remain anonymous, because the
transaction remains private.
The move comes as several mall companies raise cash to buy
cash-strapped rivals or undertake new projects as domestic
borrowing costs approach single-digits levels. Commercial real
estate firms benefit from lower interest rates, which make their
projects and investments more profitable over time.
More than 10 billion reais have been raised through stock
sales in Brazil this year, making this the best start for
domestic equity offerings for any year since 2013. Government
efforts to rebalance fiscal accounts are drawing money back into
Brazil, even though the country is struggling with a recession
that is entering a third year.
Public offerings with restricted efforts differ from
standard equity offerings in that a company does not have to
request registration of the plan with securities industry
watchdog CVM. Only qualified investors can participate in such
offerings, and the deals cannot be marketed through road shows
or the media.
Common shares rose 5.6 percent to 12.67 reais on Friday,
extending this year's gains to 22 percent.
The financial news service of O Estado de S. Paulo newspaper
reported the news earlier in the day.
($1 = 3.1740 reais)
(Reporting by Tatiana Bautzer; Additional reporting by Alberto
Alerigi Jr and Paula Arend Laier in São Paulo; Editing by