Guillermo Luksic Craig, who bet part of Chile’s biggest fortune on turning around Latin America’s largest container shipping company, died yesterday of lung cancer. He was 57.
As chairman of holding company Quinenco SA, Luksic plowed more than $1 billion into Cia. Sud Americana de Vapores SA in the past two years after it lost a record $1.25 billion in 2011. The purchase added to a family business estimated by Bloomberg at $16.8 billion and that includes Chile’s leading bank and brewer, as well as mining assets.
By shedding rented vessels and unprofitable routes, Luksic helped reduce losses at CSAV to $314 million last year, spurring a 36 percent share-price rally. The company will now focus on South American routes in joint operations with other shipping firms, allowing CSAV to revert its losses this year, Luksic said in the last published annual report of Quinenco.
“There could be some short-term volatility on CSAV’s stock as the decision to buy was his,” said Jorge Sepulveda, an analyst at Santiago-based brokerage Euroamerica Corredores de Bolsa SA. “He put people in charge and on the board who shared his vision, so the long-term strategy should remain intact.”
It was Luksic’s father, Andronico, who built up the family fortune by buying up copper deposits and a loss-making railroad in the Atacama Desert in 1980 and turning them into London-based copper mining company Antofagasta Plc. The company had revenue of $6.74 billion last year. The eldest son, Andronico, took over the family’s banking interests, while younger brother, Jean-Paul, took the mining operations on the death of their father in 2005.
The family’s fortune is controlled by Guillermo’s stepmother, Iris Fontbona, who ranks 43rd on the Bloomberg Billionaire Index.
Quinenco, founded in 1957, owns controlling stakes in lender Banco de Chile, brewer Cia. Cervecerias Unidas SA and copper wire producer Madeco. Through Madeco it owns a stake in French wire producer Nexans SA.
“He was a fundamental pillar in our family,” Guillermo’s brother, Andronico, said in an e-mailed statement today. “We will miss his advice, his company and his intelligence.”
Guillermo leaves five children and four grandchildren. His funeral will be held today in Santiago, according to the corporate communications company Nexos.
“We have to value the business contribution of people like Guillermo Luksic, who have created wealth, jobs, real development,” lawmaker Alberto Cardemil, a former member of the lower house finance committee, said on state-owned television TVN today. “The Luksic family, together with a number of other businesspeople, made possible Chile’s modern development, creating wealth.”
Guillermo entered the family business in 1975, dropping out of a law degree at the University of Chile, before becoming chairman of Quinenco in 1982 at the age of 26, according to yesterday’s statement.
Quinenco became the controller of Banco de Chile in 2001. The company then merged the lender with the local operations of Citigroup Inc. in 2008. Citigroup now owns 50 percent of LQ Inversiones Financieras SA, the holding that controls Banco de Chile.
In 2008, Quinenco’s Madeco bought a 23 percent stake in French wire producer Nexans SA and in 2011 they agreed to buy the Terpel service stations in Chile from Empresas Copec SA.
“Guillermo had an extremely well-honed long-term view for the companies he was running,” Cristobal Lyon, head of equity research at lender Corpbanca, said in a phone interview. “He knew the right moment to invite Citigroup into Banco de Chile and when to buy CSAV, which they are now turning around.”