(Bloomberg) -- Magazine Luiza SA, the Brazilian retailer that is fast becoming one of the country’s leading e-commerce providers, sold shares at 43 reais each, boosting its coffers to face escalating competition in the online field.
The offering raised 4.73 billion reais ($1.13 billion), including a primary sale of 100 million shares, the firm said in a regulatory filing. Controlling shareholders LTD Administracao e Participacoes and Wagner Garcia Participacoes also sold 430 million reais in shares, half of the amount they initially considered selling.
The company said it will use the proceeds from Tuesday’s sale to invest in technology and expand further in Brazil’s highly competitive e-commerce environment. The move by Magazine Luiza, which started as a family-owned appliance and furniture store, follows similar capital injections by larger competitors such as MercadoLibre Inc. and B2W Cia. Digital.
Billion-Dollar Share Sale Amps Up Brazil E-Commerce Battle
Magazine Luiza shares fell as much as 3.2% to 42.03 reais in Sao Paulo trading, leading the losses in the Ibovespa benchmark index on Wednesday. The new shares will start trading on Nov. 14. Banks responsible for the deal were Banco Itau BBA, Banco BTG Pactual, Bank of America Merrill Lynch, J.P. Morgan, BB-Banco de Investimento, Banco Bradesco BBI, Morgan Stanley and Banco Santander Brasil.
(Updates with company shares move in last paragraph.)
--With assistance from Cristiane Lucchesi.
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