Brazil’s Comgas Advances on Plan to Extend Voting Rights

Cia. De Gas de Sao Paulo, Brazil’s largest gas distributor, headed to its biggest jump in three years after saying it plans to extend voting rights to all shareholders.

Comgas, as the company is known, surged 5.1 percent to 39.30 reais at 3:36 p.m. in Sao Paulo, the steepest advance on a closing basis since November 2008.

The company said today it plans to join BM&FBovespa SA’s Novo Mercado, a segment of the Brazil’s stock exchange that requires all shares have voting rights. Comgas intends to swap each of its preferred shares for one common share, according to a regulatory filing. The company will announce more details after it finishes preparing the transaction, the statement said.

“The move is positive, as it will probably improve liquidity,” Erick Hood, an analyst at SLW Corretora brokerage, said in a telephone interview from Sao Paulo. “Some investors, especially foreign ones, don’t like to buy shares that don’t offer voting rights.”

Comgas had said in a regulatory filing on Oct. 19 it was studying the possibility of joining Novo Mercado.

To contact the reporter on this story: Ney Hayashi in Sao Paulo at ncruz4@bloomberg.net

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

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