Nubank’s double listing is a historic moment for the market, says US exchange director

The IPO of Nubank (IPO) on the New York Stock Exchange (Nyse), in the United States, with a simultaneous listing through B3 share certificates via BDRs, may represent a new trend for the next Brazilian companies interested in seeking resources in the global market.

Brazilian based in the US, Alex Ibrahim, head of international markets at NYSE, classifies the format chosen by the digital bank for the initial public offering of shares as a “historic moment” for investors.

“We are working with several companies in Brazil and Latin America at the moment. The pipeline [operações no radar] it is strong. And, if all goes well, I believe that in the first and second quarters of 2022 we will have other Brazilian companies listing here on the NYSE,” says Ibrahim.

In addition to the technology sector, he cites consumption and health among the most common operating segments of companies interested in listing on the American stock exchange.

What is your assessment of the debut of Nubank’s shares on the NYSE, with the bank being evaluated as the most valuable in Latin America? The New York Stock Exchange is delighted to have Nubank listed on our platform. The bank is joining a community of 31 Brazilian companies that are already listed here, with a market cap of nearly US$500 billion.

Nubank’s pricing and listing was a historic moment for the New York Stock Exchange and for Brazil as well. The transaction was very different from what we have seen in the market recently. Nubank listed the shares in the US and listed the BDRs in Brazil. This is an innovative way to access capital in the American and Brazilian market.

Our vision is that, for Brazilian companies, it makes sense to be listed in their local market. That’s why Nubank’s innovation creates a possible reference for other companies to use this format in the future. When companies are considering global funding, they may consider listing on the NYSE, but also choose to list in their home market of origin.

The Brazilian market is very strong and has enormous potential, but listing in New York brings a new component that does not exist in Brazil, which are the various investors dedicated to the technology and healthcare sector. This is something that has a lot of value.

What is your expectation regarding the search for Brazilian companies to make the IPO at the NYSE in 2022? We are working with several companies in Brazil and Latin America at the moment. The pipeline is strong. And, if all goes well, I believe that in the first and second quarters of 2022 we will have other Brazilian companies listed here on the NYSE.

Most of them are from the technology sector, but I wouldn’t leave aside the consumer and healthcare sectors, which are sectors that have attracted a great deal of interest from global investors.

What are the main reasons that contribute to Brazilian companies becoming interested in listing their shares in the US? The main reason is the way they trade the papers. Companies listed on the New York Stock Exchange trade with less volatility, more liquidity, and it is a market that attracts global investors from around the world, it is something very attractive for companies in Brazil.

The second reason is the fact that they can be part of an international community of 2,500 companies, 520 of which are non-American, represented by 46 countries. About 78% of S&P 500 companies are listed on the NYSE. And nearly 72% of tech sector IPOs over the past five years have been at the NYSE. Companies want to be part of this community.

A third very important point is the visibility that companies receive at the time of the IPO. The opening of Nubank was seen around the world.

Does the Fed’s interest rate hike tend to generate some slowdown in the demand for Brazilian companies to make the IPO at the NYSE? I believe that next year will be a strong year for IPOs. We are in conversations with several companies right now. And if the market continues to be buoyant as it has been so far, I believe that next year could be good for Brazilian companies [fazerem o IPO na Nyse], especially in the first half of 2022. There is some volatility in the market right now, but that could eventually adjust in the coming months.