Cementos Argos SA, Colombia’s largest cement maker, dropped the most in three months as the company said it was seeking approval for a preferred share sale to increase financial flexibility and support growth.
The common shares fell 4 percent to 10,080 pesos at 12:01 p.m. in Bogota. Earlier they tumbled 5.2 percent, the biggest drop since Oct. 31. The decline was the biggest on Colombia’s benchmark Colcap Index, which slipped 0.8 percent.
The company will propose a sale of preferred stock at a shareholder meeting, according to a regulatory filing that didn’t specify the amount or timing. The equity would be sold in both local and international markets, Cementos Argos said. The sale will “increase financial flexibility to maximize growth opportunities,” the company said.
“They don’t have any real cash flow issues so if they need funding, its likely they have a project in mind,” said Diego Usme, an analyst at brokerage Ultrabursatiles SA said in a telephone interview from Bogota.
Medellin-based Cementos Argos issued the statement after Colombia’s financial regulator disclosed earlier in the day on its website that the company was seeking approval for the equity offering.