(Adds earnings results paragraphs 6, 15-17)
By Cyntia Barrera Diaz
MEXICO CITY, Feb 17 (Reuters)- Mexican holding company Desc said on Tuesday it will offer shareholders more stock as part of a restructuring plan to cut debt in a deal that could see magnate Carlos Slim buy a stake in the company.
Desc, a maker of autoparts, chemicals and consumer goods, said it plans to boost its capital by about $248 million by issuing about 913 million shares of common stock.
It said the proposed offer would allow shareholders to buy 2 new shares for every 3 common shares they currently hold at a price of 3 pesos each.
Shares of Desc, long out of fashion with investors because of its debt problems, surged close to 20 percent in above-average volume in the five sessions prior to the announcement. On Tuesday, Desc B shares ended 2.01 percent lower at 4.88 pesos.
"Funds from the capital increase, if approved, will be used to lower the company's debt," Desc said. The company said in January it reached a deal with creditors to restructure around $720 million in debt.
Desc, which said the new shares would be offered only in Mexico, shortly after the announcement reported its fourth quarter loss more than doubled, hit by a non-recurring charge and large foreign exchange losses.
Desc said it reached a deal with financial group Inbursa , owned by Slim, under which Desc will be obliged to offer Inbursa up to 2 billion pesos ($183 million) of shares at the price of 3 pesos per share if its own shareholders do not take part in the stock offer.
SLIM TO PICK UP SLACK
Desc said its chairman Fernando Senderos Mestre and his family "have said they will participate in the offer and will keep control of the company."
The proposal requires shareholder approval at a meeting in March.
Desc will also propose to convert all its Series C shares into Series B shares in a move to increase the stock liquidity. If the plan is approved, Desc's capital stock would be represented by only two series of shares, A and B.
This is not the first time that Slim's Inbursa has offered to pick up any slack in Mexican share offers.
Earlier this year, Inbursa increased its stake in Mexico's No. 1 construction firm ICA to about 24 percent from 17 percent through a deal similar to Desc's.
In the ICA deal, foreign investors were also not allowed to participate.
Desc officials declined to make further comments.
Desc said it had a net loss of $152 million in the fourth quarter ended in December compared to a loss of $72 million in the year-ago period.
Sales in the quarter rose 7.2 percent to $460 million largely driven by the automotive and food businesses, the company said.
Revenue for the chemical unit, which contributed about 36 percent of total sales in the quarter, dropped 7.6 percent mainly because of the sale of Desc's adhesives and waterproofing businesses to German consumer goods maker Henkel in October.