EAC Gains as Chavez Death Seen Aiding Profits: Copenhagen Mover
EAC A/S (EAC), the Danish owner of Venezuela’s biggest meat producer, rose the most in two months in Copenhagen on speculation the death of President Hugo Chavez may make the South American country more friendly to businesses.
EAC rose as much as 9.1 percent, the most since Jan. 7. The stock advanced 4.3 percent to 108.50 kroner at 9:32 a.m. in Danish capital, with trading volume at 221 percent of the three- month daily average.
The death of Chavez, whose policies included currency controls and the seizure of more than 1,000 companies, was announced yesterday by Vice President Nicolas Maduro, who will become the country’s interim leader. Copenhagen-based EAC last month forecast lower profitability for 2013 and said the year will be “challenging” after Venezuela devalued its bolivar.
“Under the rule of Chavez, EAC has had difficulties operating its Venezuelan business in an optimal way,” Nordea Bank AB said in a note to clients today. “EAC has been limited by price controls and it has also been difficult for EAC to pull out dividends from the country.”
EAC, which also owns a moving services division, on Feb. 27 said 2013 earnings before interest, tax, depreciation and amortization will be about 3.5 percent of sales this year, down from 6.4 percent in 2012.
Venezuela on Feb. 8 devalued its currency by about 32 percent against the dollar, the country’s fifth such move in nine years.
To contact the reporter on this story: Christian Wienberg in Copenhagen at firstname.lastname@example.org
To contact the editor responsible for this story: Tasneem Brogger at email@example.com