Steelmaker CSN’s Unit IPO Is Said to Raise at Least $838 Million
(Bloomberg) -- The initial public offering of Brazilian steelmaker Cia. Siderurgica Nacional SA’s mining unit raised at least 4.5 billion reais ($838 million), according to people familiar with the matter.
CSN Mineracao, as the unit is known, and selling holders sold shares at 8.50 reais apiece on Friday, the bottom of the indicative range, said the people, asking not to be named as the information isn’t public yet.
If over-allotments are fully sold, the transaction could raise 6.1 billion reais, according to calculations based on the prospectus. CSN is still discussing the final size of the transaction with investors, the people said.
CSN declined to comment.
Morgan Stanley is leading the offer and other banks running the deal are XP Inc., Bank of America Corp., Banco Bradesco BBI SA, Banco BTG Pactual SA, UBS BB Investment Bank, Caixa Economica Federal, Citigroup Inc., Banco Fibra SA, JPMorgan Chase & Co., Safra SA and Santander Brasil.
Benjamin Steinbruch, the chief executive officer and chairman at CSN, pulled the trigger on the transaction amid investor skepticism over his yearslong pledge to sell assets in order to cut debt. The steelmaker is taking advantage of a rally in iron-ore prices, with stimulus from governments across the globe boosting demand.
CSN Mineracao is hoping to increase its iron-ore capacity to 108 million tons by 2033, up from 33 million tons currently, according to the prospectus. The unit could generate earnings before items of 9.7 billion reais in 2021 assuming iron ore prices at $120 a ton, Goldman Sachs Group Inc. estimates.
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