SAO PAULO (MarketWatch) -- Brazilian Mercantile and Futures Exchange, the BM&F S.A., and its controllers are planning to raise between 3.77 billion Brazilian reals ($2.16 billion) and BRL4.3 billion with its initial public offering, BM&F said Friday in a statement.
The share price is expected to fall within a range of BRL14.50 and BRL16.50 per share. Trading is expected to begin Nov. 30.
The futures exchange said it plans to sell 260.16 million common shares, via a secondary offer. Investors can reserve shares Nov. 19 through Nov. 27.
The shares will be sold in Brazil and to qualified foreign investors under 144A rules used by the U.S. Securities and Exchange Commission.
BM&F said it could offer an extra lot of 39 million shares if there is sufficient demand.
Banco Bradesco BBI, the investment bank of the local private bank Bradesco (BBD), and Morgan Stanley (MS) are the lead coordinator of the operation. Merrill Lynch & Co., Inc. (MER), Itau BBA, JP Morgan Chase & Co. (JPM), Citigroup Inc. (C), Deutsche Bank AG (DB), Santander Bancorp (SBP) and HSBC Holdings PLC (HBC) are the joint bookrunners.
If BM&F sells the shares under the extra lot, it will total BRL4.9 billion, became the second largest IPO Brazil has ever had in terms of financial volume.
The largest IPO so far was in October, when Brazilian Stock Exchange, Bovespa Holding SA (BOVH3.BR) raised BRL6.62 billion.
BM&F, which is the world's fourth-largest derivatives exchange in volume terms, said its shares will trade under the ticker symbol "BMEF3.BR" and will be listed under the Novo Mercado mechanism.
The Novo Mercado has the most rigorous listing rules on the Bovespa. To qualify, a company must sell a minimum stake of 25%, and 100% of the company's shares must be common rather than preferred.
In October, Chicago Mercantile Exchange owner CME Group Inc. CME, -0.19% and BM&F signed a letter of intent to become partners.
Under the terms of the letter of intent, the CME group will acquire approximately 10% of shares in BM&F, for approximately BRL1.3 billion, while the BM&F will take a 2% stake in the CME Group.
In September, the U.S. private equity firm General Atlantic LLC said it would acquire a 10% stake in the BMF for BRL1 billion.