Equity issuers to test markets

Equity issuers to test markets

Two Mexican real estate firms are scheduled to IPO Tuesday, kicking off what is set to be a series of equity issues by LatAm companies  —  lthough some would-be issuers have not launched deals amid an uncertain US political situation.

Grupo Hotelero Santa Fe is planning to raise more than $300 million-equivalent in an IPO. The hotel operator offers a combination of business travel focused hotels  — a means to play the country's growth forecast  — and beach resorts. Fibra Danhos is looking for more than $400 million-equivalent. The real estate fund is focused on office and commercial properties.

The pair will be followed next week by Mexican dairy and food products specialist Grupo Lala, targeting more than $900 million-equivalent. Grupo Financiero Interacciones arrives a day later, in a sale billed as a "re-IPO" to increase the financial holdco's free float.

Brazil's Tupy has a similar plan to increase liquidity and broaden its shareholder base when it looks to price a follow-on of more than $200 million-equivalent. For-profit educators represent the other Brazilians electing to pull the trigger during the October window. Ser Educacional will attempt to price nearly $300 million-equivalent in shares in its IPO October 18. Anima Educação is scheduled for an IPO in the fourth week of October, aiming for more than $200 million-equivalent. 

Brazilian vehicle services specialists Sacar, Ouro Verde and Unidas have so far chosen not to launch. The only Mexican left to launch is the Fibra Sendero commercial real estate fund. Outside of LatAm's two main markets, Chilean oil company GeoPark and Colombia's Avianca were the others yet to launch.

All issuers will be encouraged by the secondary performance of Mexico's Volaris. The carrier priced an IPO of almost $400 million-equivalent, despite investor concerns about the airline sector, meaning it came at the bottom of the price range. The shares had gained more than 25% through Friday's close.LF