Zell Investment Firm Weighs Latin America, India IPOs

(Bloomberg) -- Equity International LLC, the investment firm founded by billionaire Sam Zell, is weighing plans to sell shares to the public in four of its companies, in Brazil, Colombia, Mexico and India.

Equity International, which has investments in companies worth more than $12 billion, is “seriously evaluating” initial public offerings for Brazilian parking lot operator Estapar and Indian lodging company Samhi, Chief Executive Officer Tom Heneghan said in an interview.

Mexican mall operator Acosta Verde and Colombian lodging company Decameron, which operates all-inclusive hotels and resorts from Peru to the Caribbean, are also under consideration for public offerings, Heneghan said in the interview at Bloomberg’s headquarters in New York.

“We have a number of companies that we have positioned over the years to be pretty interesting potential IPO candidates,” Heneghan said. Estapar, a Sao Paulo-based network of 600 parking lots with more than 300,000 parking spaces, would be one of the first ones to go into the market, Heneghan said.

“Brazil was a market that was going through severe dislocation,” Heneghan said. Sao Paulo “has few parking spots and a heck of a lot of cars.”

Estapar, which would be the first publicly-traded parking lot operator in Brazil, is an example of Equity International’s efforts to institutionalize the markets where it invests, Heneghan said.

In Brazil, Equity International previously took homebuilder Gafisa SA public, in 2006, and mall operator BR Malls Participacoes SA in the following year.

India Hotels

Another strong contender for an IPO is Samhi, which develops and operates about 30 hotels with partners such as Hyatt Hotels Co. and Marriott International Inc., in major cities across India, Heneghan said.

That would be the third IPO in India’s lodging market in about a year. When Lemon Tree Hotels Ltd. sold shares in March, 2018, they were oversubscribed by 19%. For Chalet Hotels Ltd., which went public in January, demand exceeded supply by 57%.

“We’ve done a very nice job in a challenging marketplace to build scale,” Heneghan said. “We grew Samhi for seven years and it now has 4,000 plus keys,” Heneghan said.

Equity International, which currently has 70% of its portfolio in Latin America, is still working to expand other investments in the region, such as ARG Realty, a commercial real estate operator in Argentina, and telecom infrastructure operator ATP -- Andean Tower Partners -- based in Bogota, Colombia.

--With assistance from Misyrlena Egkolfopoulou.

To contact the reporter on this story: Fabiola Moura in Sao Paulo at fdemoura@bloomberg.net

To contact the editors responsible for this story: Nick Turner at nturner7@bloomberg.net, ;Debarati Roy at droy5@bloomberg.net, ;Crayton Harrison at tharrison5@bloomberg.net, Rob Urban

©2019 Bloomberg L.P.