Votorantim Cimentos, the largest cement producer in Brazil and the 8th largest producer worldwide, has reportedly suspended an Initial Public Offering both on the BM&F Bovespa in São Paulo and the New York Stock Exchange. The prime reason cited for the cancellation is the expected failure to achieve the stock target price at the initial offering. Votorantim is reported to have targeted a high value for the IPO, and a value that appeared unobtainable in light of a drop in the Brazilian stock exchange by approximately 8% since the beginning of June. Trading was set to begin on Thursday.
After several years of a booming economy, including a large growth in the cement sector, conditions in the Brazilian marketplace appear to be changing. Recent articles had pointed towards weakening conditions in the Brazilian economy as GDP growth has substantially slowed. The IPO was expected to be valued at between $4 and $5 billion US.