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Strategies & Market Trends : Value Investing

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To: Paul Senior who wrote (25924)	5/16/2007 11:32:11 AM
From: E_K_S	Read Replies (1) of 78516

Hi Paul - I was doing more research on VCP (Votorantim Celulose e Papel S.A.) and was surprised to find out that they are a major shareholder in ARA (Aracruz Celulose S.A. ). en.wikipedia.org From the article"...Four major shareholders control the company's voting shares: the Safra Group, Lorentzen and Votorantim (each owning 28 per cent of the voting shares) and BNDES, the Brazilian National Economic and Social Development Bank (12.5 per cent)..." . Based on the PE and book value of both companies, it appears to me that VCP is undervalued given ARA's current market price. I am not sure why the market have them priced this way, but I now hold equal amounts of each based on my total dollars invested. My direct investments in companies that are headquarted in Brazil include RIO (Companhia Vale do Rio Doce), VCP (Votorantim Celulose e Papel S.A.) and ARA (Aracruz Celulose S.A.) and as a group they represent less than 2% of my taxable portfolio. I do hold positions in other conglomerates that have operations and interests in Brazil, specifically BHP (BHP Billiton Ltd.), but their investment is small compared to their total market cap. Good find on VCP and bringing it to my attention. EKS

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