* Shares sell for 27 reais each, top of 23-27 real range
* All 19.55 mln initial and supplementary shares sold
* Offer five-times oversubscribed, source says
RIO DE JANEIRO, Feb 6 Linx SA, Brazil's largest
maker of management software for retailers, and its private
investors sold 527.85 million reais ($265.1 million) of stock in
an initial public offering, Brazil's securities regulator, the
CVM, said on Wednesday.
The shares were sold at 27 reais ($13.56) each, the top of
Linx's 23 real to 27 real suggested price range. All 19.55
million shares available in the offer, including a 2.55 million
supplementary lot of shares, were sold, according to the CVM.
A source with direct knowledge of the transaction told
Reuters on Tuesday that investors had placed firm bids for more
than five times the amount of shares offered in the IPO. The
source is not allowed by his employer to speak on the record.
Sao Paulo-based Linx sold 12.7 million shares worth 343.1
million reais in a primary offering, by which companies raise
money to fund working capital, acquisitions and other general
Investors who already owned stakes in Linx sold 6.84 million
shares of Linx stock worth 184.7 million reais in a secondary
offering. These investors included BNDES Participacoes SA
, the holding company unit of Brazil's state
development bank BNDES, according to CVM documents.
The deal's completion underlines expectations that access to
Brazil's IPO market will remain shut for companies with
insufficient track records, poor earnings visibility or
vulnerability to a downturn.
Linx has about 11,000 customers in Latin America's largest
economy and gives investors exposure to buoyant demand for
software services by retailers, apparel producers and real
Companies looking to go public face a delicate balancing act
as they try to offer the right mix of risk and return to
investors in the face of weak growth in Brazil. Stung by a
string of IPOs that failed to deliver promised returns,
investors are showing extra caution, casting a dark cloud over a
pipeline of some $6 billion of potential initial stock offerings
in Brazil this year.
"The fate of this transaction would have been different if
the company was a startup or simply a name marketed by banks,"
said a London-based fund manager who took part in the IPO but
declined to be quoted by name. "Linx is an established name, and
that's why we wanted to participate," said the fund manager, who
is not allowed to speak on the record with the media.
Linx saw revenue rise 36 percent to about 190 million reais
in the first nine months of last year, the most recent figure
Shares of Linx will trade under the ticker symbol "LINX3" on
the Sao Paulo Stock Exchange.
Linx hired the investment-banking units of Credit Suisse
Group, BTG Pactual Group, Itau Unibanco
Holding SA and Morgan Stanley & Co to handle