Chilean Compania Sud Americana de Vapores (CSAV) has agreed, at an extraordinary shareholders meeting, to a capital increase of $350m and the absorption of accumulated losses.
This capital increase will be used to adjust the company’s debt level, after the company acquired 4.14% of Hapag-Lloyd’s ownership and reached 30%, with a total investment of $450m. The increase in shareholding was financed with a bond issue of $100m and bridge loans of $350m, mainly granted by the controlling shareholder Quiñenco. This capital increase of $350m will enable the bridge loans to be refinanced. It was also agreed to reduce CSAV’s capital by absorbing accumulated losses.
“We face a scenario of high uncertainty in the coming quarters due to the effects on the economy of COVID-19. The company has launched a series of measures to reduce the operational fleet and adjust it to lower levels of demand; it has implemented cost saving initiatives and a financial plan to reinforce its liquidity. In this context, we believe the company is on a good footing to face this crisis,” said concluded CSAV general manager Oscar Hasbun.
CSAV recorded a profit of $4.7m. This is due to the results achieved in its container transport business through Hapag-Lloyd.
However, the high price of fuel maintained during the quarter and its collapse at the end of the period, generated a negative revaluation of the fuel inventories with effect in result of $64m.
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