Brazil’s Petrobras denies selling stakes in distribution network

Sarkaritel
By Sarkaritel May 30, 2015 10:36

Brazil’s Petrobras denies selling stakes in distribution network


Rio de Janeiro, May 30  Brazilian state-controlled oil company Petrobras said that the $13.7 billion divestment programme it unveiled two months ago does not include plans to sell a stake in its service station network.

“There’s no divestment decision related to the asset Petrobras Distribuidora known as BR,” Petrobras said in a statement on Friday, in response to reports indicating it planned to sell that unit to ease financial problems stemming from a massive corruption scandal.

Petrobras plans to sell a stake of between 10 percent and 30 percent in BR through a share sale on the Sao Paulo Stock Exchange to raise the cash needed to fund its operations, Rio de Janeiro daily O Globo reported on Friday.

BR is Brazil’s largest distributor and marketer of petroleum derivatives and biofuels, with a 30 percent market share and has a network of nearly 7,900 service stations nationwide.

Petrobras’ divestment programme, which it says it will carry out between 2015 and 2016, has fuelled a great deal of speculation, although this is the first time the company has expressly denied one of those reports.

The divestment programme is part of Petrobras’ strategy to raise capital after being virtually shut out of the bond market in recent months due to the corruption scandal.

Prosecutors are investigating allegations that leading Brazilian construction companies formed a cartel to over-charge the oil giant, splitting the extra money with corrupt Petrobras officials while setting aside some of the loot to pay off politicians who provided cover for the graft.

Last month, the state-controlled company wrote off $2 billion in bribery-related costs.

The credibility blow stemming from the scandal has severely hindered Petrobras’ access to debt financing, forcing the company to scale back its investment plans in the coming years and causing its share price to plunge, although its market value has recovered somewhat in recent weeks.

Sarkaritel
By Sarkaritel May 30, 2015 10:36