Mota-Engil Will Probably Delay African IPO, Fund Managers Say
Oct. 22 (Bloomberg) — Mota-Engil SGPS, Portugal’s biggest builder, will probably postpone a second attempt to sell shares in its African unit until next year, according to two Portuguese equity-fund managers.
Mota-Engil Africa’s initial public offering was suspended in July as the collapse of Grupo Espirito Santo roiled global markets. Mota-Engil Chief Executive Officer Goncalo Martins, who said in August that a share sale this year was “desirable,” said yesterday that no decision has been made.
“Because of the turbulence in the markets and the decline in shares, the IPO of Mota-Engil Africa could be postponed until 2015,” Paulo Monteiro, whose Alves Ribeiro-Medias Empresas Portugal fund holds Mota-Engil shares, said in a phone interview. “It’s almost November and at this point I think it would be hard to carry out the IPO this year.”
Mota-Engil is not alone, as slumping equity markets have derailed share sales across Europe. At least 23 companies have postponed or withdrawn $5.4 billion of European IPOs this year, according to data compiled by Bloomberg. Molecular Partners AG, a Swiss biotechnology company, postponed its planned 151 million-franc ($159 million) initial public offering in Zurich yesterday, blaming “adverse market conditions.”
“There is no definite decision yet” about selling shares in Mota-Engil Africa, CEO Martins told reporters in Lisbon yesterday. “The market remains volatile, there is a lot happening at the same time.”
Share Performance
Mota-Engil shares have declined about 18 percent since the Oporto-based company suspended plans in July to list the African subsidiary in London. The stock rose 1 percent to 3.89 euros today as of 9:46 a.m. in Lisbon.
Mota-Engil Africa was valued at as much as 1.33 billion pounds, based on the upper end of the price range considered in July. That compares with Mota-Engil’s market value today of about 800 million euros, equivalent to just 634 million pounds.
“Mota-Engil has been unlucky with this IPO because the external setting has been the worst possible for this operation,” said Pedro Pintassilgo, who helps manage 50 million euros in Portuguese assets, including Mota-Engil shares, from Lisbon for F&C. “It’s better to wait than to carry out an IPO under the current circumstances. I understand if the operation is postponed.”
To contact the reporter on this story: Henrique Almeida in Lisbon at halmeida5@bloomberg.net To contact the editors responsible for this story: Jerrold Colten at jcolten@bloomberg.net David Risser, Thomas Mulier
