In addition, if the Government manages to access the directory of companies, you will have access to strategic information of them. Going to an extreme situation, this would make espionage within companies to identify strategies not desired by the Government. This what I mention recalling those months (not very far), in which eager to Government by controlling prices, had tried to obtain information about the structure of costs of certain companies in order to identify whether they were applying an excessive margin. I believe that the influence of the Government in firms that could access through the nationalization of the AFJP system, is negative to them when seeking to attract capital to finance their investments. The prospects for evolution in the value of its shares will also be affected. These companies lost attraction to the threat posed to its growth, the presence of a myopic State. Perhaps also, the decision of the Argentine Government to assert its stock holdings and search enter directories of companies, may affect the volume of foreign direct investment (FDI) that leads toward the Argentina (which by the way, is very low in relation to other countries of the region). This possibility is specific whereas the foreign investor can feel the fear that Argentina is imitating Chavez and is following a similar estatizadora strategy.
Beyond speculation about the possible consequences of the accession of the Argentine State on the boards of several companies, the Anses received the AFJP control agency shares of 40 companies and 10 of them owns more than 20% of the equity capital. The Government has already appointed their representatives in Natural Gas as well as Gas Cuyana (MERV: GBAN), conveyor gas South (MERV:TGSU2, NYSE:TGS) and Endesa Costanera (MERV:ele). Not satisfied with this, the Government continues with this strategy and the next goal was yesterday, Siderar (MERV: once upon). In the steel company Siderar Group Techint, the Argentine Government would reach a 25,97% of equity stake. The company wants to avoid that the Argentine Government to make use of cumulative voting (which could not be exercised by the AFJP among them) to appoint a representative within the company’s Board. Although this situation is causing resistance in several of the companies, not all come with bad eyes and to a representative of the Government one of the armchairs of the directory.
Such is the case of the firm Consultatio, company dedicated to real estate and main shareholder of Nordelta (the first urban complex built in Argentina under the concept of city people) and financial activities. It is that having the Government as a partner in the business can be more than beneficial. Of course that this is not the case for the majority of companies. The nationalization of the AFJP has given the Argentine Government not only fresh funds to address this adverse international context, but also the possibility of forming part of decision-making in companies that considered strategic. As all decisions that the Argentine Government has been taking, it is true that this represent short-term benefits, but it is also true that entails large costs difficult to repair. Latinforme. com is the main source of financial information and independent opinion about the Latin American markets and worldwide from a Latin American perspective. From our offices in Buenos Aires, Argentina, we bring you the latest news and alerts to help you to get profits no matter the direction taken by the market.