After a flood of requests for registration of an initial public offering (IPO, in the acronym in English), four more companies threw in the towel and withdrew from going public at B3 in early October, according to information published on Wednesday (14) by the Brazilian Securities and Exchange Commission (CVM).
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They are: the digital property rental platform Housi; the generic drug supplier Elfa; the construction company Patrimara; and the electricity trader 2W Energia. With that, the companies expanded the dropout list, increasing to a total of 11 companies that chose to take a step back in their IPO plans.
The great movement in the search for resources in the stock market to finance expansion projects and to capitalize companies reflects the Brazilian scenario, which enjoys a basic interest rate (Selic) at the historic low of 2.00% per year, and a significant volume of money injected into the economy by the federal government and the Central Bank (BC) to increase liquidity in the country.
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Despite this, the path has disappointed some companies due to the high volatility in the Brazilian stock exchange, which still reflects the impacts of the pandemic of the new coronavirus, and the domestic and international political and economic uncertainties.
Companies postpone their IPO plans
In addition to withdrawals, there is the case of companies that decided to postpone their debut at B3, which are not yet on CVM’s list of withdrawals. Among them are: Safe; a Mortar; the Ceará Water and Sewage Company, Cagece; it’s at Iguá Sanitation.
Companies, which completed the IPO process and recently debuted on the stock exchange, also had to submit to prices below what they were looking for to keep their operations alive, while other businesses faced a sharp drop after the listing process.
There are still 42 companies that await registration with the CVM to carry out their IPO. Two of them, the hospital group Rede D’Or, and the education company Cruzeiro do Sul filed their orders this month.