Brazilian cement: Votorantim Cimentos - FT.com Votorantim Cimentos would make a great investment - three years ago. Alas, Brazil's leading cement maker is listing its pricey shares only later this month, just as the Brazilian economy is racked by stagnant growth, accelerating prices and a slipping currency that makes its investment case more dicey. VC's initial public offering will offer units instead of shares. Each unit contains one common share and two preferred shares, ensuring that the founding family retains 93 per cent of the common shares. These units will be listed both in Brazil and on the New York Stock Exchange in the form of American Depository Shares. VC is seeking to raise $3.5bn in proceeds. About $2.4bn flows to the company; the rest, net of fees, goes to the founding family, which is selling 28 per cent of the units offered. VC has nearly 40 per cent of the Brazilian cement market and its 2013 first quarter revenue in Brazil of $950m represents 77 per cent of group revenues. These revenues rose 18 per cent between 2010 and 2012. The investment case relies on the $700bn the Brazilian government has pledged to spend upgrading the country's infrastructure and reducing the housing deficit. The problem is that economic growth in Brazil has shrunk from 7.5 per cent in 2010 to 0.9 per cent in 2012, with expectations for just 3 per cent this year. Creeping inflation and a slipping real/dollar exchange rate have just pinched the benchmark Selic interest rate up an unexpected 50 basis points to 8 per cent. With a third of its debt in dollars, VC's exchange rate risk is meaningful. In its most recent quarter, VC increased revenues 20 per cent but its operating cash flow margin slipped to 26 per cent from 35 per cent in full-year 2010. Based on the offering price range, VC's implied valuation is between 12 and 14 times trailing operating cash flow. Contrast that with multiples for Holcim and Lafarge that lie below 10 times. At those levels, spending the cash at the upcoming World Cup and Olympics - both in Brazil - may be a more rewarding outlay.