General Atlantic-Backed Brazil Firm Mulls Below-Range IPO

Empreendimentos Pague Menos SA, a Brazilian drugstore chain with private equity firm General Atlantic among its backers, is considering selling shares next week below a targeted range on low demand, according to three people with direct knowledge of the matter.

The Fortaleza, Ceara state-based company may price its initial public offering below the indicative range of between 10.22 reais to 12.54 reais a share since interest from investors at those levels has been below expectations, the people said, asking not to be named because the discussions are private.

The pricing is scheduled for Monday and no decision has been made yet, the people said. Another option could be to delay or cancel the IPO, one of the people said.

Pague Menos and General Atlantic declined to comment.

General Atlantic owns a 17% stake in the company, according to a regulatory filing. Pague Menos has more than 1,100 stores and was founded in 1981 by Francisco Deusmar de Queiros.

Itau BBA, Credit Suisse Group AG, JPMorgan Chase & Co., Santander Brasil, XP Investimentos and BB Investimentos are the banks managing the deal.

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