May 12, 2020 / 5:45 PM / 2 months ago

Brazilian retailer Via Varejo considers low dilution share offering -sources

SAO PAULO, May 12 (Reuters) - Brazilian appliance and electronics retailer Via Varejo SA is considering a share offering but will not do a transaction with a high dilution rate, two people with knowledge of the matter said on Tuesday.

Brazilian media reported that Via Varejo was considering an issuance of up to 5 billion reais ($864 million) in shares, but an issue of this size would mean around 50% dilution, the sources added.

At current market prices, the company would issue a smaller value, the people added, asking for anonymity to disclose private talks.

If the shares rise after release of first-quarter earnings, the company may issue shares, as long as the dilution is not higher than 25% of its market capitalization, the sources said.

Banks have not yet been hired.

$1 = 5.7887 reais Reporting by Tatiana Bautzer; Editing by Steve Orlofsky

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