Author Topic: CIG - Comp En De Mn Cemig ADS  (Read 1642 times)

zippy1

  • Lifetime Member
  • Sr. Member
  • *****
  • Posts: 423
CIG - Comp En De Mn Cemig ADS
« on: January 25, 2013, 07:16:39 AM »
Has anyone looked at this Brazilian power company?
The price fell from $18-$19 down to $10-11 after the government required power price cut by16-28%.
But is the sale overdone? Noticed that Oaktree bought some stake in Q3..
« Last Edit: January 25, 2013, 09:07:20 AM by Parsad »


petec

  • Hero Member
  • *****
  • Posts: 1824
Re: Comp En De Mn Cemig ADS (CIG)
« Reply #1 on: January 25, 2013, 07:48:44 AM »
I have looked but not in depth.   I regard utilities generally as high risk and ones that are part state owned as very high risk.   When the Federal government gets in on the act as well...

I think you need to understand the local (state level) politics well to be comfortable with this - and don't forget that the whole sector outperformed massively in Brazil over the last few years until the concession issue this year, partly because of falling local interest rates.   If inflation picks up, that could reverse rapidly.   

That said I don't know it well so do dig in!   Did OAK buy equity or bonds?

zippy1

  • Lifetime Member
  • Sr. Member
  • *****
  • Posts: 423
Re: CIG - Comp En De Mn Cemig ADS
« Reply #2 on: January 25, 2013, 10:54:58 AM »
Petec,

         Thanks.  OAK bought equity.