September 1, 2008
by John RumseyEike Batistas ability to launch a $4 billion IPO for his OGX petroleum company in the face of tempestuous market conditions lightened the gloom in Brazils equity capital markets late spring. But celebrations were short-lived. OGX shares plunged more than 50% in the first two months of trade, while the Bovespa dropped more than 20%. OGX suggested that at least commodities were immune from the market slump. But Vales disappointing $11.6 billion global equity issue, the largest ever follow-on from the Brazilian market has given the market the willies. The mid-July deal secured just 75% of targeted funds at a discount of 5.4%-6.4% depending on share class, and Val
A secondary nosedive for OGX following a jumbo IPO adds to the gloom in Brazilian equity. There are hopes of a rebound, but the short-term outlook is bleak.