Empresa de Telecomunicaciones de Bogota SA, the phone company serving Colombia’s capital, fell for a second day after the board of directors said it will propose to withhold dividends to fund expansion plans.
ETB, as the company is known, dropped 2.7 percent to 477 pesos at 4 p.m. Bogota time. The stock earlier fell as much as 8 percent, the most since July 25.
“The market could be reacting this way because last year’s dividend was pretty good,” said Angelica Dominguez, a Medellin-based analyst at Bolsa y Renta SA. “There are people that bought the share just thinking about the dividend, and those are probably the ones making the share fall quickly today.”
ETB’s board will propose in a March 28 shareholders meeting that the company not pay a dividend in order to boost investment in a two-year strategic plan aimed at “seeking new lines of business and modernizing the company,” according to a regulatory filing late yesterday. The company paid a dividend of 36.3 pesos (2 cents) per share last year, according to data compiled by Bloomberg.