Petrobras Fuel Unit Sale Said to Lure Brazil Banking Clans

Updated on
  • Company’s distribution unit sale may reach $6 billion
  • Vitol, GP, Advent also said to be among investors mulling bid

The Brazilian bankers who joined forces last decade to form Latin America’s largest lender are seeking to buy control of the country’s giant fuel distribution business from Petroleo Brasileiro SA, people with direct knowledge of the matter said.

The Setubal and Vilella families’ Itausa - Investimentos Itau SA and the Moreira Salles family’s Cambuhy Investimentos Ltda. are planning to make a joint bid for a controlling stake in Petrobras’s BR Distribuidora in a deal that could reach $6 billion, the people said, asking not to be identified because the discussions are private. Vitol Group of Cos., the world’s largest independent oil trader, as well as private equity firms GP Investimentos SA and Advent International Corp., are also considering an offer, the people said.

Shares of Itausa fell as much as 3.2 percent on the news, and were down 2.5 percent to 8.28 reais at 11:10 a.m. local time. Itausa, Cambuhy, Vitol, Advent and GP declined to comment. Petrobras didn’t reply to requests for comment after business hours.

Petrobras, the most indebted major oil producer, is speeding up asset sales as Chief Executive Officer Pedro Parente seeks to put the state-run company back on its feet after lower oil prices, policies to subsidize fuel and a corruption probe led to multibillion losses. After announcing $9.8 billion in sales since 2015, mostly after Parente took over the helm, the producer aims to raise at least another $5.3 billion by December and $19.5 billion between 2017 and 2018.

Majority Stake

Petrobras has started sending material with information on the unit to prospective partners, the company said in a filing on Monday. Binding offers will only be made next year, Parente told reporters in Rio de Janeiro on Sept. 21. The company aims to sell 51 percent of BR Distribuidora’s voting shares.

A group led by Brookfield Asset Management Inc. agreed to buy a 90 percent stake in Nova Transportadora do Sudeste, Petrobras’s natural gas distribution unit, for about $5.2 billion, Brookfield said in a statement on Sept. 23.

The Setubal and Moreira Salles families agreed to merge their banks in 2008 to form Itau Unibanco Holding SA, currently worth about $63 billion, making it the largest lender in the region by market value. Some of the other investors may form a consortium to vie for the stake in BR Distribuidora, the people said.

“Most of Itausa’s holdings are Itau’s shares, so investors who buy the stock are interested in the banking sector, not fuel distribution,” said Vitor Suzaki, an analyst at Lerosa Investimentos.