SAO PAULO/NEW YORK, Jan 29 (Reuters) - Brazilian digital bank PicPay, controlled by the billionaire Batista family, debuts on Nasdaq on Thursday after raising $434 million in an initial public offering, the first new stock listing by a Brazilian company in more than four years.
Founded in 2012 and acquired three years later by J&F Investimentos, the holding company behind New York-listed meatpacking giant JBS, PicPay sold 22.86 million shares on Wednesday at $19 each, due to trade under the ticker symbol PICS.
The offering, which implies about a 21% dilution for existing shareholders, valued the company at about $2.6 billion, according to Brazilian business media Valor Economico.
The firm also granted underwriters a 30-day option to buy additional shares at the IPO price, potentially increasing the deal to about $500 million.
The listing was a win for brothers Wesley and Joesley Batista, who retain more than 90% voting power in PicPay. The pair rebounded from a Brazilian corruption scandal a decade ago, and their empire spans meatpacking, energy, mining, fintech, media, cosmetics and more across at least 20 countries.
Bicycle Capital, a growth fund led by former SoftBank executives including Bolivian billionaire Marcelo Claure, committed to invest $75 million in the offering, according to a filing. The IPO, which PicPay previously explored but abandoned in 2021, was led by Citigroup, Bank of America and Royal Bank of Canada.
FOUR-YEAR DROUGHT
The offering breaks a four-year drought in IPOs for Brazilian companies and could open the door for more.
Anderson Brito, UBS BB head of investment banking in Brazil, said a poll of institutional investors anticipated more than 10 Brazilian IPOs in 2026, either in Brazil or abroad.
Financial technology firm Agibank, which was valued at 9.3 billion reais ($1.79 billion) in late 2024, filed this month to list on the New York Stock Exchange.
Brazil's fintechs in particular have had success with U.S. listings due to favorable comparisons with global peers. The last Brazilian firm to go public was digital bank Nubank, which debuted on the NYSE in late 2021, raising $2.6 billion at a valuation above $40 billion, making it Latin America's largest bank by market capitalization.
The last IPO on the Brazilian stock market was fertilizer producer Vittia in September 2021.
LESS APPETITE AT HOME
New York may keep luring Brazilian IPOs, said investment analyst Pedro Galdi at fintech AGF because equity returns pale by comparison to domestic debt yields.
"With the benchmark interest rate at 15% a year, who would want to invest in an IPO in Brazil?" he asked.
In contrast, the PicPay deal illustrates solid demand in the United States.
"I think this year we'll see more on the IPO side more broadly in the U.S., not just Brazilian companies but also U.S. tech companies," said Ulrike Hoffmann, global head of equities at UBS Global Wealth Management, at a conference this week in Brazil.
That could ultimately stoke demand in Brazil. "I strongly believe that the local market will resume through large transactions, closely linked to more defensive sectors, primarily in infrastructure," said Cesar Mindof, a director of the Brazilian Financial and Capital Markets Association.
(Reporting by Luciana Magalhaes in Sao Paulo and Tatiana Bautzer in New York; Editing by Brad Haynes and Cynthia Osterman)
