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Showing posts from May, 2009

Chile's La Polar Falls on Speculation Omega Undervalues Stock

By Nathan Gill      May 29 (Bloomberg) -- La Polar SA, Chile’s best-performing retailer this year, fell in Santiago trading on speculation Omega SA’s merger offer undervalues the company’s department stores.      The Santiago-based retailer slipped 0.9 percent to 1,927.9 pesos. The shares surged 15 percent yesterday for the biggest gain in seven months.      Omega, controlled by Southern Cross Latin America Private Equity Fund III LP, is seeking a deal that would give La Polar shareholders 62 percent of the merged entity. Antonio Cruz, an analyst at Banco Santander SA, said La Polar shareholders should have about 70 percent of the new company.      Under the offer, La Polar would exchange 135 million new shares at 1.07 per Omega stock, investment bank Larrain Vial SA wrote. That values La Polar at 513 billion pesos ($909 million), or 2,324 pesos a share.
      “The price and conditions that Omega are offering don’t look particularly advantageous for La Polar shareholders to us,” Raul…

Chile Department Store Ripley Rises to 11-Month High on Merger Speculation

By Nathan Gill      May 29 (Bloomberg) -- Ripley Corp SA rose to the highest in more than 11 months on speculation the Chilean retailer will integrate its department-store chain with Grupo Saieh’s supermarkets after Saieh bought a 20 percent stake in the company this month.      Ripley climbed 5.8 percent to 418 pesos in Santiago trading. The stock earlier rose to 420 pesos, the highest intraday price since June 30.      Rival Empresas La Polar SA received a proposal yesterday to merge its department stores with Omega supermarkets controlled by Southern Cross Latin America Private Equity Fund III LP. The offer has spurred speculation Grupo Saieh, run by Alvaro Saieh, will seek to combine Ripley’s stores with the SMU supermarket chain, Francisco Obilinovic, an investment analyst at Penta Estrategia y Inversiones, said today by phone from Santiago.       “Before Saieh bought into Ripley he bought six different supermarket chains and now he has them under one brand,” Obilinovic said. “T…

Chile Confirms 21 New Cases of Swine Flu, Now Has 107

By Nathan Gill      May 26 (Bloomberg) -- Chile’s health ministry confirmed 21 new cases of swine flu today, giving the country a total of 107, the health ministry said.      Nineteen of the new cases resulted from “community transmission” in four different regions, Osvaldo Sagrado, an official in charge of health-care networks at the ministry, told reporters today in Santiago.      The virus known as H1N1 “is behaving similarly to the rest of the world,” Sagrado said. “The great majority of the cases are minor, with a high transmission rate and a low mortality rate, which fortunately in Chile has been zero.”      The South American country confirmed its first case on May 17 after two female tourists returning from the Dominican Republic were diagnosed with the H1N1 virus.      A 38-year-old woman from Chile’s Lakes region is in critical condition though her condition is “better than yesterday,” Sagrado said.

Bachelet Sets Chile’s Priorities as Economy, Welfare

By Sebastian Boyd and Nathan Gill      May 21 (Bloomberg) -- Chilean President Michelle Bachelet said managing the economic crisis is her top priority and emphasized her commitment to social welfare in a speech laying out her policies for the next 10 months.      The government plans to pay a bonus of 40,000 pesos ($71) to poor families in August, Bachelet said. She spoke today in her last annual message to lawmakers before elections in December.      Bachelet’s popularity rose to its highest since she took office after she started using Chile’s $22 billion in copper revenue savings to stimulate the economy and fight unemployment. Under the Chilean constitution she is barred from running in this December’s elections and will step down in March 2010, as Chile celebrates 200 years of independence.      “The first task we have for this year is to recover from the international economic crisis,” Bachelet said. “It seems a long time since the days when we faced economic crises by tighteni…

Chile Confirmed 10 Cases of Swine Flu, Bachelet Says

By Sebastian Boyd and Nathan Gill      May 19 (Bloomberg) -- Chilean health officials confirmed five new cases of swine flu today, bringing the country’s total to 10, President Michelle Bachelet told reporters in Santiago.      The confirmed cases include three women who traveled from the Dominican Republic, and a further cluster of cases in a Santiago school that may have originated in Mexico, she said. All the patients are receiving treatment, she said.      The five new patients confirmed today are all connected to the San Nicolas de Myra School in the Las Condes district of Santiago, according to a statement distributed by the Health Ministry by e-mail.      Chile confirmed its first two cases of swine flu on May 17. The World Health Organization may raise its pandemic alert to its highest level, a former WHO adviser said, after Japan confirmed 33 new infections and the total worldwide rose to 9,830.      Bachelet, a doctor, called on Chileans “to maintain calm, trust in our heal…

Swine Flu Sickens 3 More in Chile, Including Children

By Nathan Gill and James Attwood      May 18 (Bloomberg) -- Chile confirmed three new cases of swine flu, bringing the number of people known to be infected to in the country to five, health officials said today in Santiago.      A 6-year-old child is receiving treatment at home and his Santiago school will be closed for seven days, Claudia Gonzalez, Chile’s chief epidemiologist, said today. An 8-year-old student at the same school also was confirmed with the flu known as H1N1, Cecilia Morales, acting deputy health minister, told reporters separately.      Chile reported its first cases yesterday after two female tourists who had been on a flight from the Dominican Republic were confirmed with the flu. A third woman on the flight is hospitalized and receiving treatment, Gonzalez said today.      “We were prepared for this to happen at some point,” Carolina Toha, the government’s spokeswoman, said today to reporters. Chile will follow the WHO’s guidelines and recommendations, she said…

Chile Reports First Swine-Flu Victims, Minister Says

By Nathan Gill and Sebastian Boyd      May 17 (Bloomberg) -- Two female tourists returning from the Dominican Republic became Chile’s first confirmed cases of swine flu, Health Minister Alvaro Erazo told reporters today in Santiago.      They arrived in Chile yesterday on Copa Airlines Flight 437 from the beach resort of Punta Cana, Dominican Republic, via Panama, he said. Erazo confirmed the two cases, women aged 25 and 32, in two press conferences in Santiago today.      The number of confirmed cases of swine flu in the world has risen to more than 8,400 in at least 39 countries, the World Health Organization said today on its Web site. Chilean health officials have contacted 80 of the more than 100 people who shared the flight with the women and have contacted other groups of tourists who had stayed in the same resort, Erazo said in comments broadcast by CNN Chile tonight.      “Chile has taken all the measures necessary to contain this outbreak,” Erazo told reporters this morning…

BM&FBovespa Proceeding With Chile Trading Plans, Oliveira Says

By Nathan Gill      May 14 (Bloomberg) -- Paulo de Sousa Oliveira Jr., chief business development officer of BM&FBovespa SA, Latin America’s largest exchange, comments on plans to integrate with Chile’s stock exchanges. Oliveira spoke in Spanish to reporters in Santiago today.
On plans to integrate with Chile’s exchanges:      “The idea we have is that a Chilean investor could access the Brazilian exchanges through the network the exchange has here.      “In Santiago we are going to put a hub that has all of the information that the Brazilian exchange has, derivatives, stocks, so that people can access them.      “The technological condition of being connected to the market could happen this year.”
On whether the global economic crisis will postpone integration:      “The crisis isn’t a factor for postponement. On the contrary, the crisis intensifies the sense of opportunity so something has to be done now.”
On the integration of Latin America’s other exchanges:      “If investor…

Enap Says Chile Quintero Plant to Help Profitability

By Matthew Craze and Nathan Gill      May 13 (Bloomberg) -- Empresa Nacional del Petroleo, Chile’s state-controlled oil and gas company, said the start-up of a liquefied natural-gas plant will help the company’s refinery business return to profitability.      The Quintero LNG plant will reduce power costs at the company’s Aconcagua refinery by a third starting in August, Chief Executive Officer Rodrigo Azocar said today in an interview. The company, known as Enap, lost $958 million last year after boosting purchases of crude oil to make up for dwindling natural-gas supplies from Argentina. Enap said the Quintero project will improve profit because its gas will reduce costs at Aconcagua and a second refinery in southern Chile.      Enap will invest $400 million this year in the Quintero project and other improvements, Azocar said. The company on Jan. 15 issued about $330 million worth of bonds in the South American nation’s domestic market.      “For the manager of a refinery, having …

Ripley Falls Most in 5 Months on Fear Database to Hurt Profit

By Nathan Gill      May 13 (Bloomberg) -- Ripley Corp SA, a Chilean department-store operator, fell the most in more than five months on speculation a government proposal to create a national credit database will hurt retailers’ profits from credit card sales.      The Santiago-based retailer dropped 4.5 percent to 360 pesos in Santiago trading at 2 p.m. New York time, the steepest drop since Dec. 1 on a closing basis. Cencosud SA, Chile’s biggest retailer, and rival La Polar SA also fell.      Chile’s government proposed the creation of a national credit database on May 11 to strengthen consumer rights and improve equal access to credit, the finance ministry said in an e-mailed statement.      “In Chile, financing is a very important business for retailers,” Alfredo Ugarte, an analyst at Corp Research SA, said today by phone from Santiago. “Retailers have exploited a business in the middle- and lower-middle-income segments where banks for the most part haven’t entered. With the cons…

Chile’s Lan Seeks Airline Partner, Traffic Expansion

By Nathan Gill and James Attwood May 7 (Bloomberg) -- Lan Airlines SA, Chile’s biggest air carrier, is interested in forming an alliance with a partner “north of Ecuador,” Chief Executive Officer Enrique Cueto said.
Lan hasn’t reached any agreements and is looking for new markets to expand its cargo and passenger business, Cueto told reporters at a conference in Santiago today.
“We have interest and will continue looking to try and find partners with an airline north of Ecuador,” Cueto said.
Airline alliances provide benefits such as booking fliers on each other’s planes, which can extend carriers’ networks without the expense of a merger. Lan said last week that first-quarter profit fell 35 percent to $65 million, damped by $57.9 million in costs from wrong-way bets on fuel prices.
Cueto said passenger capacity would rise 10 percent this year while cargo capacity falls 5 percent. Santiago-based Lan wants to fly cargo in Brazil and start passenger service in Colombia, Cueto said.

Falabella Plans to Invest $2 Billion Through 2012

By Nathan Gill and James Attwood May 7 (Bloomberg) -- SACI Falabella SA, Chile’s biggest retailer by market value, plans to invest $2 billion through 2012 to expand in Latin America, Chief Executive Officer Juan Benavides said.
Falabella is seeking opportunities in Colombia while its “very big” investment plans for Peru will depend on how the global financial crisis evolves, Benavides said at a conference in Santiago today.
“The plan that we have is tremendously aggressive, with a strong focus on taking advantage of opportunities in Colombia,” Benavides said.
Falabella, which runs department stores, supermarkets and home-improvement outlets, reported a 22 percent drop in first-quarter profit last week as spending in Latin America slowed. The International Monetary Fund said economies in the region may recover before the world’s more developed countries.

Chile Lending May Rise 2%, Bank Association Says

By Nathan Gill and James Attwood May 5 (Bloomberg) -- Bank lending in Chile may increase by 2 percent this year after the economy probably “touched bottom” in the first quarter, said Hernan Somerville, president of the country’s banking association.
Chile’s economy may recover in the coming months, ending the year little changed from last year, Somerville told reporters in Santiago today. Chilean authorities have slashed the benchmark interest rate by 6.5 percentage points and started a $4 billion stimulus package to cushion the economy from the global financial crisis. The economy contracted a less-than-expected 0.7 percent in March from the same month a year earlier, the central bank said today on its Web site.
“We see that as the economic cycle probably has touched bottom in the first quarter in Chile, and is now rebuilding, lending should return to these levels of growth,” Somerville said.
The government may unveil in the coming weeks further measures to stimulate spending in the…