Citi Ups Stake in Chile Investment Firm

Citigroup has exercised an option to acquire an 8.52% stake in Chile-based investment firm LQ Inversiones Financieras from local business conglomerate Quinenco, for UF12.9m ($519.4m). The transaction, which closes May 3, boosts Citi’s stake in LQ to 50%. Bankers close to the companies say that the deal is not expected to have any material impact on Quinenco, as the option was agreed upon about 2 years ago. Quinenco, which has holdings in telecom, financial services, manufacturing and food and beverage industries, is 83% owned by the Luksic family, which is rumored to be among the parties interested in acquiring the remaining 11% stake in LAN airlines owned by an investment vehicle controlled by Chilean president Sebastian Pinera. A sale of the stake is expected by April 30. Before the earthquake that shook the country February 27, a sale was supposed to happen by March 11, when Pinera took over as president.