InterCement Halts $1 Billion IPO of Brazilian Operations

Brazilian cement maker InterCement Participacoes SA suspended the initial public offering of its local unit that was expected to raise as much as $1 billion, citing unfavorable market conditions.

InterCement struggled to find investors to buy its shares within the marketed range of between 18.20 to 25.50 reais each, according to people familiar with the matter, who asked not to be named because the information isn’t public yet. Investors signaled interest on the deal below that range, but the company resisted lowering prices, one of the people said. The postponing of the deal, that was scheduled to price Wednesday, was confirmed in a company filing.

The suspension adds to a series of setbacks in the local IPO market in recent days including logistics firm BBM Logistica -- which canceled its offering -- and aluminum firm Companhia Brasileira de Aluminio, that priced below the indicative range. InterCement was trying to take advantage of rebounding cement sales in Brazil.

The cement maker, which also operates in Argentina, Egypt, Mozambique and South Africa, was planning on listing its InterCement Brasil SA unit in the local exchange. The transaction could have raised about 5.1 billion reais ($1 billion) if the deal were priced at the high-end of the marketed range and over-allotments were fully sold, according to calculations based on the preliminary prospectus.

Bradesco BBI, Bank of America Corp., Itau BBA, JPMorgan Chase & Co. and UBS-BB were handling the deal.

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