Brazilian state lender Caixa Economica Federal has chosen the bank syndicate that will manage the initial public offering (IPO) of its insurance unit, Reuters said.
According to the three sources with knowledge of the matter listened by the news agency, Morgan Stanley will lead a 10-bank syndicate including the investment banking units of Banco Bradesco SA, Itau Unibanco Holding SA, Banco Plural, Banco BTG Pactual, Banco do Brasil SA, Credit Suisse AG, Banco Santander Brasil SA, Bank of America and Caixa Economica Federal.
Insurance unit Caixa Seguridade will be listed in Brazil, although the banks expect to market the offering in the United States also. The banks expect to value it at around R$60 Bn ($14.77Bn), the sources said.
Caixa Economica Federal did not reply to a request for immediate comment.
Caixa plans to sell a stake of about R$10 Bn [$2.5 billion] in the insurer. Caixa Seguridade will not raise cash by issuing new shares, the sources said.
Caixa CEO Pedro Guimaraes wants an IPO in the short term, in March or April, but Caixa Seguridade still needs to sign agreements with private insurers to sell different kinds of insurance to its clients.
On January 5th, Caixa announced an agreement with Japan’s Tokio Marine to sell home insurance to its clients. Tokio Marine will pay R$ 1.5 Bn to Caixa.
Caixa Seguridade posted a net income of R$1.2 Bn for the first nine months of 2019.
Original Story: Insurance Jornal | Carolina Mandl
Photo: Caixa Economica Federal
Edition: Prime Yield