Chile’s Grupo Luksic has acquired another 8.0% stake in local shipping company Cia. Sudamericana de Vapores (CSAV) for CLP350.5 per share, or about $120m equivalent, via its subsidiary Quinenco. With this transaction, Luksic increases its stake in CSAV to about 20%, the company says. A CSAV spokesman says that the deal was privately negotiated. CSAV’s shares soared 13.4% to CLP 397.5 after the sale was announced. Quinenco’s shares jumped 3.98% to close at CLP1,880.00. On March 23, Luksic acquired a 10% stake for about $120m equivalent. Besides the share acquisition, Luksic also said it plans to propose a $1bn capital increase for CSAV at a shareholder meeting to be held on April 8.
Category: Chile
Posted inDaily Brief
Shell Sells Chile Assets to Luksic
Royal Dutch Shell agreed to sell $614m of its downstream assets in Chile to Grupo Luksic subsidiary Quinenco. The sale includes all of Shell’s retail, commercial fuels, bitumen and chemicals businesses, in addition to related supply and distribution infrastructure in Chile. Shell is understood not to have used any advisors. Quinenco is understood to have used Santander as an advisor. Quinenco did not return calls for comment.
Posted inDaily Brief
LatAm PE Investment Breaks Record
PE investment in LatAm reached a record $8.1bn in 2010, according to a report by LAVCA, a 122% increase over the year before. That compares to a 7% decline in US fundraising and a 32% decline in European fundraising, according to LAVCA. Southern Cross Group and Advent International closed the two largest LatAm funds at $1.68bn and $1.65bn, the association said. “We are seeing unprecedented interest from global investors looking to diversify their portfolio,” said Cate Ambrose, president and executive director of LAVCA. Brazil continues to dominate investment, capturing 76% of invested capital. “While newcomers are focused on Brazil, veterans of the region are targeting investments in other major markets where there is less competition, such as Mexico, Colombia, Peru and Argentina,” Ambrose said. “We also see some Brazilian firms positioning themselves as regional players instead of Brazil-only investors by expanding into other Latin American markets.” Both Chile and Colombia saw a significant increase in the number of deals and amount of capital committed to companies in each country. While growth financing and buyouts captured the largest share of deal capital (39% and 37% respectively), the amount of capital directed towards early stage investments grew by 54%, with the average deal size increasing at a healthy pace, from $1m in 2009 to $1.6m in 2010.
Posted inDaily Brief
Fitch Downgrades Chile’s La Polar
Chilean retail company La Polar has been downgraded by Fitch to A minus from A on a national scale with negative outlook. The downgrade reflects the deterioration in the retailer’s credit business and its negative impact on the company’s debt and credit profile. In 2010, Polar’s Ebitda fell 17%. Adjusted debt to Ebitdar reached 7.1x by the end of 2010, compared to 5.1x in 2009. The ratings agency expects continued deterioration in the company’s credit profile. This is partly as a result of the company’s international expansion plan. This could put pressure on cash flows, increase debt and decrease liquidity, says Fitch.
Posted inMagazine
Peru Project Finance: Make it Rain
Odebrecht is using an auction structure to bring private-public financing to a Peruvian infrastructure project. The financing format may be used elsewhere in LatAm.
Posted inDaily Brief
BCI Signing $325m Syndicated Loan
Chile’s Banco de Credito de Inversiones is expected to sign a 2-year loan for $325m today, according to bankers with knowledge of the transaction. The deal has been upsized from the $300m it has initially been seeking, and there are 14 lenders, aside from the joint bookrunners, Standard Chartered and Wells Fargo. Pricing is 85bp over Libor, adds the person with knowledge of the transaction.
Posted inMagazine
LatAm Finance Ministers Face New Challenge
Praised for a speedy earthquake response, Chile again leads the LatAm finance ministry pack. Capital controls hurt Brazil, while Argentina finally draws some praise.
Posted inDaily Brief
Chile’s Factorline Plans Local Bond
Chilean financial services company Factorline yesterday began a roadshow to market a bond issue of up to CLP50bn ($105m) or its equivalent in UF, says a banker on the deal. The roadshow will end in Chile next Friday. Factorline has registered 3 tranches, of which only 1 or 2 will likely be selected depending on investor demand, the banker explains. A CLP25bn tranche has a term of 5-years and a 5.0% coupon. A 7-year UF2.3m tranche has a 3.5% coupon and 10-year UF2.3m tranche has a 3.8% coupon. Proceeds from the deal, rated A on a national scale, will be used to refinance debt and for working capital. The issue should take place during the week of April 11, the banker says. Banco de Chile is managing the sale. In August, Factorline issued CLP20bn in 2015 local bonds through BBVA priced to yield 6.88%, or 129bp over the government benchmark.
Posted inMagazine
Chilean Retail Comes Off Boil
Chilean retailers have unveiled aggressive expansion plans for 2011. Bottom line growth and stock performance are not expected to hit last year’s heady pace.
Posted inMagazine
Chilean DCM Overcomes Intervention
Despite central bank intervention that pushed local rates higher, Chile’s local corporate debt market should remain active. Bankers expect similar volume to 2010.