Eike Batista’s OGX Petroleo & Gas Participacoes SA, the oil and natural gas company that Deutsche Bank AG says may run out of cash next month, fell by a record 40 percent in Sao Paulo trading.
In the final half hour of trading, the shares tumbled to 30 centavos from 50 centavos in volume that was 4.8 times the three-month average, according to data compiled by Bloomberg. Brazil’s benchmark equity index rose 0.2 percent. OGX is scheduled to exit the MSCI Brazil Index on Sept. 2.
Batista’s commodities group extended the biggest rout among major stocks this year as the former billionaire sells shares and a dispute with Petroliam Nasional Bhd. fuels speculation OGX is facing an imminent cash crunch. The Rio de Janeiro-based explorer lost 63 percent this week, exceeding a decline in early July when the company shelved projects and warned it may cease output at the only producing oilfield.
“It may have been Eike selling shares because OGX already said he may reduce his stake to close to 50 percent,” Leonardo Brito, an analyst at hedge fund Teorica Investimentos, said by telephone from Rio. “I don’t remember seeing something like this. It’s almost 20 percent of the company changing hands.”
Morgan Stanley led the brokerages selling OGX stock today with a net 183 million shares sold, according to data compiled by Bloomberg. Itau Unibanco Holding SA’s brokerage unit was the biggest net buyer, the data show.
The company’s press office in Rio declined to comment on today’s share decline in an e-mailed response to questions.
Batista’s LLX Logistica SA slumped 6.5 percent, while his shipbuilder OSX Brasil SA rose 1.4 percent. Miner MMX Mineracao & Metalicos SA, which said today that it agreed to sell assets in Chile, gained 3.3 percent.
OGX said this week that Petronas has no right to delay buying stakes in two Brazilian blocks for $850 million after the Malaysian producer said the deal hinges on OGX undertaking a debt restructuring. OGX will run out of cash this quarter if it doesn’t receive the first installment of the Petronas payment, Deutsche Bank said in Aug. 27.
The company announced this month that it hired Blackstone Group LP to advise on a study of its capital structure as Batista raises cash and sells company stakes and assets after his fortune plummeted on missed production and profit targets.
Batista sold 49.8 million OGX shares Aug. 28, or a 1.54 percent stake, and has shed a 5.67 percent holding since March, the company said in a regulatory filing yesterday.
“The company has been informed by Mr. Eike Batista of his intention to carry out specific sales of OGX shares of a total amount above 5 percent of his current position,” it said.