AGI raises US$240m in downsized float
AGI raised US$240m from a NYSE IPO late on Tuesday that was significantly downsized and priced at a lowered valuation, prompting it to target a limited group of long-only investors.
Goldman Sachs, Morgan Stanley and Citigroup priced 20m new shares at US$12, the bottom of a revised US$12–$13 marketing range and the original US$15–$18 target on what was to have been an offering of 43.6m shares.
The banks allocated more than 90% of the reduced offering with the top 25 investors, skewed towards long-only investors.
AGI, a hybrid physical/digital bank more commonly known as Agibank, fell 2.3% on debut Wednesday and traded late in the week at US$10.36, 13.7% below offer.
“In my experience, you don’t cut the price and size unless you have a sure thing,” said one senior LatAm ECM banker. “It can become a vicious cycle from here. There is a risk this company becomes orphaned.”
The disappointing outcome comes after rival Brazilian fintech PicPay traded poorly after raising US$434m from its NYSE IPO in late January. Despite pricing at the high end of the marketing range, PicPay shares have fallen 21.9% from offer to US$14.50.
Agibank is using proceeds from the offering for general corporate purposes, including potential acquisitions.
At the US$12 offer price, Agibank was valued at a US$1.9bn equity market capitalisation. That is just above the R$9.3bn (US$1.7bn) valuation on a R$400m investment in late 2024 by Lumina Capital Management.
The downsize meant Agibank's offering no longer met the criteria for “qualified IPO” under the terms of the agreement with Lumina, meaning the Brazilian asset manager will retain a board seat and have a say over matters of corporate governance.
Agibank ran afoul of Brazilian regulators late last year for harmful practices related to payroll deductions under the country’s national security systems payment record.
The Brazilian government lifted a suspension from participating in the programme on January 12 after Agibank agreed to enhanced oversight and a R$1m compensatory payment.
In 2025, Agibank reported net income of R$1.04bn–$1.05bn on a 44.8% growth in revenue to R$10.55bn–$10.7bn. Total loans to customers grew by about 42% last year to R$34.5bn–$34.9bn, based on preliminary results provided in its IPO prospectus.