Brazil’s Caixa plans IPOs of Elo, asset manager in coming months

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People line outside the Caixa public bank, where people try to receive emergency aid given by the federal government to the most vulnerable, following the coronavirus disease (COVID-19) outbreak, in Rio de Janeiro, Brazil April 29, 2020. REUTERS/Pilar Olivares

SAO PAULO, Oct 26 (Reuters) – State-owned lender Caixa Economica Federal (CEF.UL) is planning to list its asset management unit and the payments firm Elo by the beginning of 2022, Chief Executive Pedro Guimaraes said in an interview.

Both flotations are part of government’s plans to list some of Caixa’s business units and raise fresh funds to its coffers through a partial sale.

Reuters reported in April that Caixa had chosen six banks to manage Elo’s initial public offering on the Nasdaq, including Morgan Stanley (MS.N), Goldman Sachs (GS.N) and JPMorgan & Co (JPM.N). read more

Elo runs a payment network launched a decade ago to compete with Visa Inc (V.N) and Mastercard Inc (MA.N). Besides Caixa, Banco do Brasil SA (BBAS3.SA) and Banco Bradesco SA (BBDC4.SA) are also shareholders in the company and plan to sell a stake in it.

“Despite current unfavorable market conditions, Elo’s IPO is a good deal to offer investors as this is high-growth company,” Guimaraes said.

The investment unit Caixa Asset has 500 million reais ($88.65 million) under management. Guimaraes said Caixa plans to sell a stake of up to 15% in the asset manager.

($1 = 5.6404 reais)

Reporting by Aluisio Alves in Sao Paulo
Editing by Matthew Lewis

Our Standards: The Thomson Reuters Trust Principles.

Source: Reuters


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