China's Ant Financial to commit $100 million to IPO of Brazil's StoneCo

Brazilian card processor StoneCo Ltd said in a securities filing on Monday that Chinese e-commerce giant Alibaba’s payment affiliate Ant Financial has committed to invest $100 million in the company’s initial public offering.

Ant Financial is the latest big-name backer to show interest in StoneCo’s IPO that could raise up to $1.1 billion on Nasdaq.

StoneCo has seen robust investor demand for its IPO that has drawn interest from Warren Buffett’s Berkshire Hathaway Inc, two people with knowledge of the matter told Reuters, declining to be identified as the negotiations are private.

Such major investors in the IPO have helped drum up further interest, one of the sources said.

The high demand allowed for its pricing, initially planned for Thursday, to be moved up to Wednesday, the person said. Financial publication IFR first reported on Monday the pricing would be moved forward.

Goldman Sachs, JPMorgan Chase & Co and Citigroup, the global coordinators of the offering, may discuss raising the price of StoneCo’s shares above the $21-$23 marketing range based on the market response, the two sources said.

Such a move has yet to be discussed with the company.

Berkshire Hathaway and some of StoneCo’s current shareholders, including Madrone Capital Partners, could acquire up to nearly half of the 47,727,273 shares offered in the IPO, according to an earlier securities filing.

The involvement of deep-pocketed international investors underscores the potential growth of electronic payments in a country where only two-thirds of families’ consumption is paid in cash.

In 2017, card payments totalled 1.36 trillion reais ($367.24 billion), according to the country’s card industry group, Abecs.