By Brazil Stock Guide – Pague Menos (B3: PGMN3) said Monday (Sept. 15) it is considering a follow-on share offering of about $50 million. The deal would include a primary issuance of new shares and a secondary sale by funds managed by General Atlantic, one of its key shareholders.
The company has engaged Itaú BBA, BTG Pactual, Bradesco BBI and XP Investimentos to structure the transaction, with placement efforts abroad. If the offering goes ahead, existing shareholders will have priority rights to subscribe to the primary tranche. The company said the deal would not change its controlling structure.
“We are conducting preparatory work to assess the feasibility and terms of the potential offering,” said Luiz Renato Novais, Pague Menos’ Chief Financial and Investor Relations Officer, in a statement.
Market conditions will be decisive
The offering’s execution will depend on investor appetite and overall market conditions in Brazil and abroad. It also remains subject to corporate and regulatory approvals. The company emphasized that no public offering is currently underway in Brazil, the United States, or any other jurisdiction.
The move comes amid volatility in Brazilian equities, as companies seek to raise capital to bolster balance sheets and cut debt. Pague Menos, Brazil’s third-largest drugstore chain, faces rising competition following the expansion of Raia Drogasil (B3: RADL3) and other regional players.
If completed, the follow-on will allow General Atlantic to trim its stake, while Pague Menos strengthens its cash position through the primary tranche. Investors seeking exposure to the retail pharmacy sector may find the deal an entry point at potential discounts.
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