B3 evaluates debt issuance abroad; guidance must be changed

B3 (B3SA3) is evaluating an issue of debt securities in the international market, as informed by a relevant fact this Friday (10).

According to the company, the resources – if the operation is carried out – would be used for the ordinary management of the Brazilian stock exchange operator’s business.

B3 intends to start, as of this Friday, meetings with potential investors.

“The effective execution of the operation is subject, among other factors, to market conditions, interest from potential investors, and necessary corporate approvals,” he added.

B3 Guidance

With the potential issuance, B3’s financial leverage may, temporarily, until the amortization of other debts already contracted, exceed the ratio of 1.5 times the gross debt over the recurring Ebitda of the previous 12 months.

Additionally, subject to the completion of the transaction, the guidance leverage for 2021 should be revised to 2.0 times gross debt over recurring Ebitda for the previous 12 months.

“The potential issuance seeks to diversify the Company’s funding sources and is in line with its strategy of optimizing the management and cost of its debt”, he adds.

Radar contingency

Despite strong results driven by strong activity in the equity and debt markets, which caused B3’s recurring profit to exceed second-quarter expectations, another factor caught the attention of investors.

At the time, B3 revised the risk rating of a legal contingency from “remote” to “possible”.

This contingency is related to an action in which B3 is alleged to have caused losses in US dollar futures market transactions conducted by the Central Bank in January 1999.

Currently, the updated value of the contingency is R$31.2 billion (including interest and fines) – a considerable amount that was not on the investors’ radar.

Falling stocks

Year-to-date, B3 shares have fallen by more than 30%, while the Ibovespa has fallen by more than 2%.