SANTIAGO, June 13 Chilean bank CorpBanca said on Friday that a lawsuit brought by U.S. investment firm Cartica Management to stop a proposed merger with a Brazilian bank was "entirely without merit."
Brazilian bank Itau Unibanco Holding SA is seeking to win control of CorpBanca in what would be Latin America's largest banking merger since 2008.
Cartica's lawsuit, a rare instance of investor activism in the region, alleges that Itau, CorpBanca and billionaire Alvaro Saieh, CorpBanca's controlling shareholder, violated U.S. anti-fraud and disclosure rules.
Cartica, which owns around 3.2 percent of CorpBanca's common shares, added Itau as a defendant in its lawsuit on Thursday.
"CorpBanca continues to firmly believe that Cartica's claims are entirely without merit, and that Cartica's interests are not aligned with those of other CorpBanca shareholders," said the Chilean bank in a statement.
In response to Cartica's claim that Saieh, Itau and CorpBanca were "continuing to withhold material information" CorpBanca said: "CorpBanca has supplied an abundance of disclosures about the proposed merger throughout the process...CorpBanca's shareholders have all material information they need to cast a fully informed vote."
Control of CorpBanca would give Itau a foothold in retail banking in Chile, and provide a way to expand in Colombia, South America's fastest-growing economy last year.
The case is pending in the U.S. District Court in the Southern District of New York.