Fabricato Plunges 70% After First Failed Auction: Bogota Mover

Fabricato SA sank 70 percent after the stock exchange auctioned off some of the Colombian textile maker’s shares following a three-month suspension of the stock.

Fabricato posted its biggest one-day decline, tumbling to 21 pesos in Bogota today, three days after the exchange failed to draw bids for the shares at a higher price range it set.

Regulators suspended trading of Fabricato on Nov. 16 as the collapse of the brokerage Interbolsa SA, which was backing a bid to take control of the Medellin-based company, sent the stock plunging 21 percent to 72 pesos. Investment bank SBI Banca de Inversion SA had estimated that the shares could have a value of 35 pesos to 55 pesos when trading was renewed.

“The market clearly didn’t take the valuation report as a reference,” said Valeria Marconi, an equity analyst at Correval SA brokerage in Bogota. “Added to poor earnings results, investors are getting rid” of the shares.

Clients of Interbolsa, which is being liquidated by the Colombian government, were left with the shares after the firm defaulted on its debt and didn’t pay back loans secured by the textile company’s stock.

“I don’t see much upside from here,” said Marconi. “If anything, we’ll see more selling pressure.”