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Brazil's Odebrecht mulls sale of Braskem's majority stake -sources

Published 2016-03-11, 10:17 a/m
© Reuters.  Brazil's Odebrecht mulls sale of Braskem's majority stake -sources
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By Tatiana Bautzer and Guillermo Parra-Bernal
SAO PAULO, March 11 (Reuters) - Grupo Odebrecht SA
ODBES.UL , Latin America's largest engineering conglomerate, is
considering selling the majority stake it has in petrochemical
producer Braskem SA BRKM5.SA , according to three sources with
direct knowledge of the situation.
Odebrecht, controlled by the namesake millionaire Brazilian
family, could exit Braskem in a joint transaction with
state-controlled oil producer Petroleo Brasileiro SA PETR4.SA ,
said the sources, who requested anonymity because the plan
remains under study.
Odebrecht denied in an e-mailed statement to Reuters any
intention to sell the stake in Braskem. Petrobras did not return
requests for comment.
Petrobras decided to sell a 36-percent stake in Braskem in
January and is being advised by investment banking firm Banco
Bradesco BBI, the sources said. Since then, at least three
companies have shown interest on the stake: Canada's Brookfield
Asset Management Inc BAMa.TO , Saudi Arabian Oil Co, known as
Saudi Aramco, and an unidentified Chinese petrochemical firm,
according to the first two sources.
Still, the Petrobras process has stalled as acquirers wait
for a decision by Odebrecht about a possible sale of the 38
percent it owns. A sale of the majority of the company would be
easier and could fetch a higher price, because both firms could
get a premium for their stake, the same sources added.
At current market prices, the combined value of the stake
that Petrobras and Odebrecht have in Braskem, Latin America's
largest maker of resins, is worth 11.1 billion reais ($3.05
billion), according to Thomson Reuters Data.
A precondition for the Petrobras stake sale is that
Odebrecht accepts the buyer as partner in Braskem. Odebrecht's
indecision has the Petrobras process paralyzed, the two sources
added.
Salvador, Brazil-based Odebrecht is currently under
investigation in Brazil for its involvement in a graft and
influence-peddling scandal known as "Operation Car Wash." Family
member Marcelo Bahia Odebrecht, who ran the company since 2008
until recent months, was sentenced on Tuesday to about 19 years
in prison in connection to the scandal.
The scandal has undercut Odebrecht's access to financing,
and the group - which has more than a dozen business units from
rig leading to ethanol production and construction - is
currently seeking to ease a swelling debt burden.
Although there are no U.S. companies currently interested in
the deal, some of the possible acquirers of Petrobras' stake in
Braskem in a wider sale process could be worried about possible
impacts of an association with Odebrecht considering the Foreign
Corrupt Practices Act (FCPA), according to one of the sources.
Folha de Sao Paulo newspaper reported this Friday that
Odebrecht's stake in Braskem is being targeted by banks as
collateral for Odebrecht Agroindustrial's $ 2.5 billion debt
renegotiation, without saying how it got the information.

($1 = 3.6338 Brazilian reais)

(Editing by Nick Zieminski)

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