Argentine highway operator Autopistas del Sol SA, which defaulted on about $357 million of bonds in 2009, rose the most in almost three weeks after the government announced a cut in subsidies to long-distance buses.
The stock advanced 3 percent to 1.03 pesos at 1:20 p.m. in Buenos Aires. That was the biggest jump on a closing basis since Jan. 12, when it gained 4.2 percent. The benchmark Merval (MERVAL) index dropped 0.4 percent.
Argentina’s President Cristina Fernandez de Kirchner yesterday announced in the official gazette the elimination of toll subsidies for long-distance bus companies starting Feb. 1. The move means Autopistas will no longer have to recover the fees from the government, said Leopoldo Olivari, an analyst at Bacque Sociedad de Bolsa brokerage in Buenos Aires.
“Making the company less dependent on the government’s subsidies eliminates any discretionary activity in the business,” Olivari said. “The elimination of subsidies provides more transparency.”
To contact the reporter on this story: Eliana Raszewski in Buenos Aires at firstname.lastname@example.org