Business

Brazil's office and school supplies retailer Kalunga asks for IPO registration

Kalunga's announcement reinforces the recent reopening of initial stock offers in Brazil, in the wake of the recovery of the equity market

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  • The company says in the preliminary prospectus that it will use the resource from the sale of new shares to open more stores;
  • Kalunga today has 222 stores in 20 states of the country and the Federal District.

Kalunga, the largest retailer of office supplies and school supplies in the country, this Friday asked for registration for an initial public offering (IPO), as the sharp rise in shares in recent weeks has encouraged more Brazilian companies to seek resources in the market to support expansion plans.

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The company says in the preliminary prospectus that it will use the resource from the sale of new shares to open more stores, a distribution center in Brazil’s Northeast, strengthen its capital structure, and strengthen its fast printing business, with a focus on binding and printing.

Created in 1972 in the capital of São Paulo, Kalunga today has 222 stores in 20 states of the country and the Federal District, in addition to operating on digital channels.

The transaction, which will be coordinated by BTG Pactual, Bradesco BBI, XP and UBS-BB, will also serve for partners Paulo Sérgio Menezes Garcia and José Roberto Menezes Garcia to sell interest in the business.

Despite strong growth in recent years, in 2020 through September Kalunga’s net revenue, of BRL 1.32 billion, was 16% lower than a year earlier, due to the economic effects of the COVID-19 pandemic.

Kalunga’s announcement reinforces the recent reopening of initial stock offers in Brazil, in the wake of the recovery of the equity market, with the Ibovespa marking this Friday the fifth consecutive week of gains.

READ ALSO: Brazilian electronics firm Intelbras files for IPO

Only this week, Kalunga is already the third to apply for IPO registration, joining sugar and ethanol producer Jalles Machado and online retailer of household items Westwing.

(Translated by LABS)

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