Bloomberg News

Vapores Gains Most Since June Before Chile Share Sale Vote

October 04, 2011

(Updates with closing share prices in second paragraph.)

Oct. 4 (Bloomberg) -- Cia. Sud Americana de Vapores SA, Latin America’s largest container shipping company, rose the most in four months as investors bought shares to have the right to participate in a planned sale of new stock.

Vapores rose 6.5 percent to 125.81 pesos, the biggest advance since June 17, while Chile’s Ipsa index slumped 4.2 percent. Vapores shares have lost 78 percent this year compared with the Ipsa’s 27 percent slide.

“The gain is due to tomorrow’s shareholder meeting where the price of the new shares will be indicated,” said Jorge Rios, an analyst at the brokerage unit of Corpbanca. “Many investors want to pick up some of the shares to be ready for the announcement and have the right to buy.”

Vapores shareholders will vote on the sale of $1.2 billion in new shares to shore up its finances. Quinenco SA, the Luksic family’s holding company, agreed to acquire as much as $1 billion of the new shares while the Claro family agreed to buy $100 million through holding company Maritima de Inversiones SA.

Vapores had a second-quarter net loss of $339 million, the biggest in at least five years, as an increase in new vessels entering the market outpaces a faltering recovery in demand, sending rates down, the company said Sept. 5. Even after cutting some routes and forming associations on others, Vapores forecasts “negative” results in the third quarter and “significant losses in 2011,” it wrote.

Quinenco announced plans in April to enter an agreement with Maritima de Inversiones to share control of the shipping company and Guillermo Luksic was appointed chairman.

After the share sale, Vapores plans to spin off its container handling unit Sudamericana Agencias Aereas & Maritimas SA, or SAAM, and seek a “strategic partner” for the company.

Quinenco fell 4.2 percent to 1,102 pesos, the lowest since January last year.

“Investors are punishing the stock as they will now be stuck with Vapores’ problems,” Rios said.

--Editors: James Attwood, Brendan Walsh

To contact the reporter on this story: Eduardo Thomson in Santiago at ethomson1@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net


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