Petrobras must sell "Liquigas-Doimo" billionaire value

Petrobras is close to announcing the sale of its distribution of cooking gas (LPG) Liquigas-Doimo for Brazilian industrial group Ultrapar Participações, told Reuters a source with knowledge of the matter.

According to the source, Petrobras will get about 2.8 billion reais with the deal, which is expected to be announced later this week.

Petrobras ‘ preferred shares rose about of 3% on Thursday morning.

In a note to clients, analysts at BTG Pactual said that Petrobras is conducting the sale “in a very good multiple, greater than 10 times Ebitda”, referring to the indicator of earnings before interest, taxes, depreciation and amortization, the acronym in English.

Still, analysts at BTG and Brazil Plural also highlighted that the agreement may be obstacles in the Administrative Council for economic Defense (Cade).

The Company wouldn’t comment on Thursday, while Petrobras did not comment immediately the information.

The Company already owns the distributor of LPG Ultragaz, with 23% of participation in the Brazilian market.

“The acquisition would raise the Company’s market share to 46 percent,” said Brazil Plural, in a note to clients.

On 14 October, Petrobras and Ultrapar said they were in exclusive negotiations for Liquigas-Doimo. At the time, Reuters reported that the business could revolve around 3 billion reais.

Ultrapar outperformed competitors like Supergasbrás, brazilian subsidiary of the Dutch SHV Holdings, the Turkish national investment firms and Argaz.

The sale of the Liquigas-Doimo is part of the program of 2015-2016 divestments of Petrobras, which intends to sell a total of 15.1 billion dollars in assets by the end of this year, and more than 19.5 billion dollars in 2017-2018.

The newspapers O Estado de s. Paulo and Valor Econômico reported the closing of the deal in their printed editions of this Thursday, also citing sources.

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