Solid performers that buck the trend
In a sector populated by so many lumbering - and sometimes state-owned - monopolies, good management can be hard to find. Some utilities companies are trying hard. Chilectra, by contrast, is a success story already. Analysts consider it to be the lowest-risk utility in Latin America.
Chilectra is the energy-distribution company for the Chilean capital, Santiago, and it also operates abroad. It owns and helps operate companies in Argentina, Brazil, Colombia and Peru. And its reputation as a first-class operator extends beyond Latin America.
"Chilectra is the industry leader," says Jonathan Arnold, analyst at Santander Investment in New York. "US companies are coming in and using them as the benchmark." What can Chilectra offer an American utility company? It is a survivor of a hostile market environment and has learnt how to cope with the problems of theft and dilapidated assets common to its industry in Latin America.
"We work in a more undeveloped environment where labour is cheaper, technology is lower and there is a lot of network theft," says Paul Fontaine, chief financial officer at Chilectra. "We have no doubt that American companies will rapidly learn how to deal with this, but Latin American companies have a head start there."