The São Paulo and New York offices of Davis Polk & Wardwell LLP; Mattos Filho, Veiga Filho, Marrey Jr e Quiroga Advogados in São Paulo and Estudio Garrido Abogados in Bogotá have helped Uruguay-based pharma company Biotoscana raise 1.3 billion reais (US$427 million) via an initial public offering (IPO) in Brazil.
US private equity fund Essex Woodlands Healthcare Partners, which is a Biotoscana shareholder, hired BMA - Barbosa, Müssnich, Aragão in São Paulo. The New York and Washington, DC, offices of Cleary Gottlieb Steen & Hamilton LLP, and Pinheiro Neto Advogados in São Paulo advised the underwriters.
It is thought Biotoscana also called on Colombia's Osman & Rodríguez Abogados and that two of its shareholders, Robert Guttmann and Robert Friedlander, hired Brazilian firm Schivartche Advogados, but this could not be verified before publication.
US firm Perkins Coie did not work on the IPO, but it has previously represented Essex Woodland in Latin America, advising the fund in Biotoscana's acquisition of Argentina-based pharmaceutical manufacturing business Laboratorio LKM, for example.
Brazil's securities commissioner, CVM, approved the share issuance on 24 July, after initially delaying the offering because of concerns regarding the purchase of Laboratorio LKM. Biotoscana revised down the value of its total asset base to assuage CVM's concerns.
The IPO was five times oversubscribed and priced at the mid-point of the range, highlighting strong demand for a rare Latin American biotechnology deal.
The offering comes less than a week after the Brazilian subsidiary of French retailer Carrefour raised 5 billion reais (US$1.6 billion) in an IPO, rounding off the busiest week in four years for equity offerings in the country.
Lawyers are cautiously optimistic that increased capital markets activity signals the beginning of Brazil's economic revival. "It's too early to say if there is a recovery [and] there is still political instability. But if you look at some of the recent economic data, with inflation under control, interest rates being lowered and the fact that these capital market transactions are happening, the situation is looking more stable," says Mauro Leschziner, M&A partner at Machado Meyer Advogados.
Corruption allegations surrounding President Michel Temer continue to unnerve investors, prompting many to delay plans to go public.
The success of Biotoscana's issuance sends a good signal to reinsurer IRB Brasil Resseguros and renewable power company Omega Geração, which both plan to list shares on the São Paulo stock exchange in the coming weeks.
Brazil has experienced an IPO drought from 2014, with very few companies opting to go public during uncertain macroeconomic and political times. 2017 has seen increased capital markets activity, however.
Counsel to Essex Woodlands Healthcare Partners
BMA - Barbosa, Müssnich, Aragão
Partner Roberto Dias Carneiro and associates Felipe Prado, Júlia Rodrigues and Gabriela Rubio in São Paulo
Counsel to Grupo Biotoscana
Davis Polk & Wardwell LLP
Partner Maurice Blanco and associate Elliot de Carvalho in São Paulo, and partner Kathleen Ferrell and associates Adela Troconis, Dao Fu and Sijia Cai in New York
Mattos Filho, Veiga Filho, Marrey Jr e Quiroga Advogados
Partner Jean Marcel Arakawa and associates Elisa Fachin Soares Lemos, Mariana Cano Assef and Luccas Augusto Adib in São Paulo
Estudio Garrido Abogados
Partner Lucas Granillo Ocampo and associate Gisela Montesanto in Bogotá
Counsel to JP Morgan, Itaú Unibanco Holding and Grupo BTG Pactual
Cleary Gottlieb Steen & Hamilton LLP
Partners Jorge Juantorena, Daniel Ilan and William McRae, and associates Jonathan Mendes de Oliveira, Julian Hill, Daniel Chor, Lilia Stantcheva, Josiah Child and Inae Kim, and senior attorney James Corsiglia in New York, and partner Paul Marquardt in Washington, DC
Pinheiro Neto Advogados
Partners Henrique Lang and Guilherme Sampaio Monteiro, and associates Leonardo Baptista Cruz and Luiz Felipe Vaz Guimarães in São Paulo