- Sale of 49% stake in final stages; terms not disclosed
- Deal needs authorization from Petrobras board and regulators
Petroleo Brasileiro SA, Brazil’s state-controlled oil company, is in the final stages of selling a stake in a natural gas distribution holding company to Japan’s Mitsui & Co. as it seeks to raise cash by divesting assets.
The sale of a 49 percent stake still needs final approval from the board of directors and regulators, Rio de Janeiro-based Petrobras said in a statement Tuesday. Financial terms of the deal weren’t disclosed. Bank of America Corp. estimates proceeds of 1 billion ($250 million) to 1.2 billion reais from the sale, according to a note to clients Tuesday.
Petrobras has more than 7,000 kilometers (4,350 miles) of gas pipelines in Brazil that supply residential and industrial users, according to its website. The company is cutting spending at peripheral businesses to focus on its most promising oil fields in deep waters in the South Atlantic.
Chief Executive Officer Aldemir Bendine said Monday that the company is working to reduce costs to withstand a combination of lower oil prices and a weaker currency, which has increased the cost of servicing the company’s debt. Petrobras joins other major oil companies including Chevron Corp. and ENI Spa in selling assets amid a rout in oil prices to raise cash and reduce operating expenses.