RIO DE JANEIRO—Brazil's state-run oil company Petró leo
Brasileiro SA is in talks with three potential buyers interested in
purchasing a stake in its fuel distribution business before a
planned initial public offering of that unit, possibly later this
year, chief executive Aldemir Bendine said in an interview late
Tuesday.
A final decision on selling a minority stake in Petrobras'
retail gasoline business, which operates under the brand name BR
Distribuidora, hasn't yet been made, Mr. Bendine said. He said none
of the three potential buyers, which he described as "European and
Asian" have entered into exclusive talks.
"This is a study, I am working with both models, the partner
takes a smaller stake and then we have the IPO for the rest, in a
way that we keep control of the company," Mr. Bendine said.
BR Distribuidora is Brazil's largest gas station chain, with
some 7,500 stations across the country. Petrobras posted net income
of $253 million in the first half of this year for its distribution
activities.
Petrobras announced earlier this month that it is studying an
initial public offering of BR Distribuidora. The move is part of
the firm's effort to shed assets amid slumping oil prices. The
company expects to have the sale of shares done by the end of this
year, if market conditions allow it, and Petrobras will keep
control of the distribution unit, Mr. Bendine said.
The IPO, with or without a possible sale of a minority stake, is
a key part of Petrobras' efforts to raise capital, reduce its
massive debt load and regain investor confidence in the wake of a
corruption scandal.
Mr. Bendine, who took the helm of the company in February as
part of a management shake-up, said a potential sale and IPO of BR
Distribuidora is one of the alternatives currently under
consideration by Petrobras for its divestment of the unit.
In June the company announced plans to cut investment by 37%,
and said it expects to divest $15.1 billion in assets in 2015-2016,
and $42.6 billion by 2018. As of June 30, the firm had total debt
of 415.55 billion reais ($119 billion), making it the most
leveraged oil firm in the world.
Last week Petrobras's board gave the company the green light to
seek regulatory approval for the BR Distribuidora IPO. Petrobras
has hired Citigroup Inc. to lead the IPO, said a person familiar
with the deal. The other five banks working on the deal are Banco
do Brasil, Bradesco, Itau BBA, Santander and Bank of America Corp.,
according to the same person.
Representatives for all the banks declined to comment.
Petrobras plans to have BR Distribuidora listed in the Novo
Mercado, a segment of the stock exchange in Sã o Paulo that
requires stricter corporate governance than the traditional listing
mechanism, in a move that could bolster investor confidence.
Mr. Bendine declined to disclose other company assets for sale,
saying that there is keen competition by other major oil companies
to sell assets in the current market environment. He said Petrobras
has hired several banks to work with different assets without
naming them, and noted that the company will give priority to
investing in its highly valuable deep water oil fields, known as
the "pre-salt."
But he ruled out for now the sale of part of its stake in Libra,
a rich oil field buried beneath a thick layer of salt off the
Atlantic coast of Brazil. France's Total SA, Royal Dutch Shell,
China's Cnooc Ltd. and China National Petroleum Corp. are
Petrobras's partners in Libra. Petrobras currently owns a 40% stake
in that field.
"We are talking to everyone, we are not only talking to
potential investors about divestments, but also about
partnerships," Mr. Bendine said.
He said the company is looking for a partner for its giant
Comperj refining and petrochemical complex that is under
construction in the state of Rio de Janeiro. Mr. Bendine said the
first phase of the Rio de Janeiro complex is almost completed, but
the company still needs some $3 billion to finish it.
Write to Luciana Magalhaes at Luciana.Magalhaes@dowjones.com
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