Brazil car rental provider Movida on Monday, March 8, objected to rival Localiza’s proposed takeover of Unidas, sending Localiza’s shares down by 8% in afternoon trading, making it the biggest loser in the Bovespa index.
According to Reuters, Movida is asking Brazil’s antitrust regulator CADE not to approve the takeover, according to a securities filing. The three companies are the top Brazilian rental car companies and a merger would leave the market heavily dominated by just two players.
The deal was announced in September and sent Localiza’s shares soaring in the double digits.
Analysts at Credit Suisse wrote in a note to clients that they did not expect Movida’s complaint to yield significant results.
“We expected Movida to have a more neutral position,” the note read. “Meanwhile, we do not think this will significantly affect (the deal’s) chances of obtaining approval.”
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