Landers cautious on world record Petrobras rights issue

BlackRock's Will Landers, the largest investor in South American equities, is maintaining a big underweight in Petrobras as the giant prepares for its world record rights issue.

Landers - manager of the $7bn BGF Latin American fund and $500m BlackRock Latin American investment trust - says while the Brazilian equity market has performed broadly flat in 2010, the Petrobras cash call has driven the stock down by as much as 30%, well below its peers. The majority state-owned Petrobras is undertaking what is likely to be the record-breaking rights issue this week, with the giant offering minority shareholders up to $32.5bn in new shares, while the Brazil Government will pour in upwards of $45bn. Petrobras is using the cash call, which is due to be priced on 23 Se...