Brazil’s state-controlled oil company Petroleo Brasileiro SA on Thursday received three binding bids for its gas pipeline network company TAG, three sources with knowledge of the matter said.
The bids were from groups led by Australia’s Macquarie Group, United Arab Emirates’ sovereign wealth fund Mubadala Development Co [MUDEV.UL] and France’s power company Engie SA, the sources said.
Petrobras, which is selling 90 percent of its stake in TAG, and the bidders did not immediately comment on the matter.
The sources added all bids were higher than the $5.2 billion Canada’s Brookfield Asset Management Inc paid for another gas pipeline unit sold by Petrobras, Nova Transportadora do Sudeste (NTS).
Some of the proposals could be above $7 billion, the sources added.
The sale of TAG is part of a program of asset sales with a $21 billion target in 2017-2018, as Petrobras seeks to reduce its $95 billion debt pile – the largest in the global oil industry
Macquarie, the world’s largest manager of infrastructure investment funds, has partnered with Canada Pension Plan Investment Board, known as CPPIB, Singapore’s sovereign wealth fund GIC Pte LTd and two Brazilian investment firms.
Mubadala has joined EIG Global Energy Partners LLC. It is unclear if Engie has a partner.
At least two consortia will finance their bids with loans from international banks. Merger and acquisition financing is growing in Brazil as interest rates reach their lowest level ever.
Petrobras will analyze the bids, which included financing commitments and contracts, but has not informed the bidders of the deadline for a decision.
Source: Reuters.com