Brazil's Totvs agrees to buy StoneCo's Linx unit
Totvs has shown interest in Linx since 2020, when StoneCo won a bidding war by paying 6.7 billion reais for the retail software developer. In April, Totvs entered exclusive talks with StoneCo to acquire the unit.
Sao Paulo-traded shares of Totvs seesawed after the announcement, climbing 3.1 per cent early in the session before erasing gains and falling as much as 1 per cent. They were last flat, while benchmark stock index Bovespa gained 0.6 per cent.
Totvs said in a securities filing that the transaction will be financed through its cash reserves and debt instruments yet to be arranged "under favorable market conditions". The deal requires approval from Brazil's antitrust watchdog.
"With this acquisition, we will strengthen our position in retail, expanding our portfolio and reinforcing our ability to meet the demands of all types of retailers," Totvs CEO Dennis Herszkowicz said in a statement.
In an interview earlier this year, Herszkowicz told Reuters the company was considering other acquisitions besides Linx, adding that none of the potential deals would rely on capital from divestitures.
($1 = 5.5667 reais)
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