Prudential To Pay $34 Million For 18% Of Chile Real-Estate Firm Paz
22 Juin 2009 - 8:10PM
Dow Jones News
PLA Chile, a real-estate investment fund managed by U.S. firm
Prudential Financial Inc. (PRU), signed an agreement Friday with
shareholders of Chilean real-estate developer Paz Corp. (PAZ.SN) to
buy new shares totaling 18.3 billion Chilean pesos ($34.3 million),
or 18% of the company.
Four investment companies known as Familia Paz, which currently
control 59.2% of Paz Corp., have agreed to approve the capital
increase in a shareholders meeting, Paz Corp. said in a
statement.
Familia Paz will retain control of the company with a 42% stake,
Prudential's PLA Residential Fund III Chile LP, known as PLA Chile,
will own 18%, and minority shareholders will hold the remaining
shares.
The capital increase is designed to strengthen the Chilean
company's investment plan, Paz Corp. said in a statement.
This is Prudential's first investment in Chile, and the deal is
pending a due diligence study of Paz and its subsidiaries, the
statement said.
"Prudential is a strategic investor given the size of the fund
and their expertise... it's too early to say what specific
investment opportunities this will create," said a person close to
the operation.
Paz will issue 91.3 million new shares, and PLA Chile will
subscribe 100% of the shares worth CLP200.00 each.
Paz Corp.'s shares were trading at CLP250.00 midday Monday, down
3% from Friday as Chile's blue-chip stock index, the Ipsa, tumbled
2%, tracking losses in the U.S. market. Paz has traded at a high of
CLP314.99 and a low of CLP109.00 in the last 52 weeks.
BanChile and Citigroup Global Markets are advising Prudential in
the operation.
Paz has 40 years experience developing real-estate projects in
Chile, and it currently has 64 projects in development in Santiago
and other parts of the country.
-By Julian Dowling, Dow Jones Newswires; 56-2-820-4241;
julian.dowling@dowjones.com