Cia. Sud Americana de Vapores SA, Latin America’s largest container shipper, fell the most in six months after announcing plans to sell new shares to fund a fleet expansion and pay down debt.
CSAV was down 1.2 percent to 46 pesos at 12:29 p.m. in Santiago after earlier falling as much as 4.7 percent in the biggest intraday slump since Sept. 25. The Ipsa benchmark index was little changed.
The shipper, which is controlled by Chile’s richest family, called a shareholder meeting for April 29 to vote on the sale of $500 million in new shares to fund expansion plans and reduce debt, according to a regulatory filing yesterday.
“In the short term we can expect high volatility in the stock,” brokerage Euroamerica Corredores de Bolsa SA said in an e-mailed note today.
CSAV plans to spend about $570 million to acquire seven container transport vessels from Samsung Heavy Industries Co Ltd., increasing ownership of its fleet to 55 percent of ships from 37 percent currently, according to the regulatory filing.
The shipper also said it will prepay $258 million of debt with American Family Life Assurance Co., or Aflac. The company is taking out a new $140 million loan from Banco Latinoamericano de Comercio Exterior SA, according to the filing.
CSAV said Francisco Perez Mackenna will replace former Chairman Guillermo Luksic, who died last week of lung cancer. Perez Mackenna is chief executive officer of Quinenco SA, the holding company of CSAV’s controlling Luksic family. Andronico Luksic, Guillermo’s brother, will join the board.
Quinenco has put more than $1 billion into CSAV in the past two years after the company lost a record $1.25 billion in 2011. The loss narrowed to $314 million last year as the company reduced its reliance on rented vessels and shed unprofitable routes.