Argentina-based travel-booking website Despegar.com (DESP) raised an estimated $332 million in what could be the first in a slew of IPOs after the country’s burst back into the international bond market over the past year.
Despegar.com offered 12.8 million shares on the New York Stock Exchange that priced at $26, the high end of the offering range, Bloomberg reports.
Argentina Vacation Travel Video Guide
Shares were up 18% Wednesday afternoon to $30.29. The Global X MSCI Argentina exchange-traded fund(ARGT) was down 0.8%.
The fund holds 27 stocks, but online retailer Mercado Libre (MELI) accounts for a quarter of assets. There are more than 20 Argentine companies in the IPO pipeline, according to Mauro Staltari, an investment analyst at Highland Capital Management, the bond-focused hedge fund operator based in Dallas, who spoke with Barron’s last week.
Today’s IPO marks the third since President Mauricio Macri took office in late 2015.
Companies need long-term dollars to invest in future growth after more than a decade under a socialist regime that defaulted on debt. Macri’s government resolved lawsuits with holdout investors in defaulted debt, fueling a flurry of bond issues. Argentina has raised more than $50 billion in the bond market since April 2016, including $20 billion in corporate and quasi-sovereign government credit, according to Nomura data.
Insiders intended to sell a third of Despegar.com shares, Renaissance Capital reported, adding that Morgan Stanley and Citi were lead managers of the offering.