Next Monday, April 26th, up to 45 mn additional shares will be added to CETIP’s free float as a consequence of the end of the first leg of the lock-up period (180 days).

· Advent and the banks with board representation (Itaú and Bradesco) plan to hold on to their shares, while Santander declared that it plans to divest its 2% stake in the company. The increased float should fuel traded volumes in the company’s stock (currently at an ADV of R$5 mn)

· The lack of traded volumes coupled with decreasing registered volumes at CETIP and a compression of the company’s high multiple (currently at a 30% premium to BM&F Bovespa) caused short interest in the shares to rise significantly. We believe the increasing float will continue to put downward pressure on stock prices.

Provided By: Equity Research Desk, www.erdesk.com