Brazil's billionaire Klein family was able to find a way to cash out on the home appliance retailer they established, after the $1.2 billion or BRL 2.85 billion equity sale of Via Varejo. The billionaire family found an exit after a clash occurred with the other owners on the value of the retailer, Bloomberg reported.
The report said Chairman Michael Klein sought to lower their 47% stake in the firm to 26%. They questioned the price they received three years ago when their firm Casas Bahia Comercial Ltd was sold to Cia Brasileira de Distribuicao Grupo Pao de Acucar. The latter then merged Casas Bahia Comercial to its local unit Ponto Frio to form Via Varejo.
According to Empiricus Research Analyst Felipe Miranda who was interviewed in the report, yesterday's offering most likely came after Klein was not able to reach a deal with Pao de Acucar on the issue. The report quoted him as saying by phone, "The climate for share offerings in Brazil couldn't be worse at the moment, so investors are seeing this sale only as a way to try to resolve a conflict between shareholders. It's possible that they preferred to sell shares at a lower price rather than wait for a better time just to put an end to the tension."
Citing a regulatory filing, the report said the units for yesterday's sale were priced by shareholders at BRL 23 per share. Each unit corresponds to a single voting and two preferred shares. The sale price was under the price range of BRL 25.60 to BRL 33.60 per share as estimated by the company in its prospectus. The filing showed that the shareholders of Via Varejo were able to sell 123.7 million units in the offering.
The report also stated that after the sale was completed, the Rio de Janeiro-based retailer will be holding a public float of 29.3%.
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