Maple Gains as Companies Agree to Initial $4 Million InvestmentMichelle F. Davis
Maple Energy Plc climbed from near a record low after two companies agreed to invest an initial $4 million in the Peruvian natural gas and oil refiner.
Shares rose for a third straight day, climbing 27 percent to 10 cents, the highest level on a closing basis since Sept. 29. The gain was the biggest among 27 companies on the Lima General Index, which climbed 1.9 percent today.
The deal with Lima-based holding company Grana y Montero SAA and Brussels-based ethanol producer Alcogroup SA ends a search for a way to sustain Maple’s ethanol business after a potential investor backed away last month, pushing the shares to their lowest on record. The companies would commit to make a further equity investment of $13 million while Grana plans to pay $31 million for a Maple hydrocarbon subsidiary.
“The market today was expecting a capital injection so Maple could develop its ethanol project,” Omar Avellaneda, an analyst at Credicorp Capital in Lima, said by phone. “We can see in the market that it’s good for Maple.”
The company’s ethanol business has struggled with maintenance costs and low sugar cane yields, Scotia Capital Inc. analysts led by Paul Figueroa Mantero said in a research note published today.