Chile: Hortifrut hails successful IPO

July 13 , 2012

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Chilean fruit company Hortifrut has successfully completed its initial public offering (IPO) on the Santiago Stock Exchange for a 29% stake, but the opening value was lower than previously hoped.

The integrated international berry business was aiming to raise US$75 million from the offering, but at an opening price of CLP320 (US$0.648) meant the shares were released at a total of CLP33.14 billion (US$67.16 million).

Hortifrut president Victor Moller said he was very proud of the result achieved.

"The funds raised will enable the company to continue the development of projects that have already been successfully implemented, such as the expansion of new berry varieties (blueberries and raspberries), whose competitive advantages have already been a success,"Moller said in a statement.

He added the funds would be used to help open new markets geographically, especially in Asia and Latin America, and in terms of business segments such as food service through the company's innovative ready to eat (RTE) technology.

"Without a doubt the best is yet to come."

Banco Penta corporate finance director Raúl Schmidt said the IPO was backed by orders totaling US$530 million, which is around 7.5 times the offering.

Celfin Capital corporate finance director José Zamorano said the offering involved a widely diversified group of investors including pension funds, insurance companies, domestic and foreign investment funds and private investors.

The shares (IPSA: HF) initially rose to CLP330 (US$0.669) but closed 2.5% lower yesterday at CLP311.93 (US$0.632).

Hortifrut has a trade presence in 37 countries with an integrated business model from breeding through to the end consumer. It is currently the biggest trader of blueberries and organic blueberries in the world, and number two in the overall berry category.

In the 12 months to March 2012 the business recorded sales of US$190 million, selling a volume of 28 million kg.

It has 30 distribution centers in the world, serving more than 400 customers and working with over 700 producers in both hemispheres. In March it registered 1,130ha of plantations.