BTG Assuming $2.3 Billion of Debt to Buy Panamericano

Brazilian billionaire Andre Esteves’ Banco BTG Pactual SA is buying a controlling stake in Banco Panamericano SA by assuming 3.8 billion reais ($2.3 billion) of debt to cover the bank’s losses, according to the nation’s deposit insurance fund.

BTG will pay no cash for the stake it’s buying from Silvio Santos, Sao Paulo-based Panamericano’s founder, said Antonio Carlos Bueno, the executive director of the deposit fund, which is financed by the country’s banks. By taking over the 17.5-year debt with the deposit fund, BTG is paying the equivalent of 450 million reais, as measured in net present value terms, for the 51 percent of Panamericano voting shares, Bueno said.