Published On: Mon, Apr 1st, 2019

Exclusive: Investors drop out of two groups vying for Petrobras’ gas pipeline unit – sources

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FILE PHOTO: A logo of the Brazil's state-run Petrobras oil company is seen in Rio de Janeiro
FILE PHOTO: A logo of the Brazil’s state-run Petrobras oil company is seen in Rio de Janeiro, Brazil March 25, 2019. REUTERS/Sergio Moraes

April 1, 2019

By Tatiana Bautzer and Carolina Mandl

SAO PAULO (Reuters) – At least three investors left separate groups interested in acquiring a gas network pipeline that will be sold by Brazil’s state-controlled oil company Petroleo Brasileiro SA, three sources with knowledge of the matter said.

Those departures will likely leave a third group, led by France’s Engie with Canadian pension fund Caisse de Depot et Placement du Quebec, stronger. The final bids for TAG, as the unit is known, are due on Tuesday.

After the previously reported departure of Australia’s Macquarie from one of the groups, which included Brazilian investment firm Itausa Investimentos SA and Singapore sovereign wealth fund GIC, the other two investors that were supporting the bid, sovereign wealth fund Adia- Abu Dhabi Investment Authority and investment manager Wren House Infrastructure, also pulled out.

A second group, led by Mubadala Investment Company and EIG Global Energy Partners, had been in talks with the world’s largest investment firm, BlackRock Inc, but the company gave up.

Wrenhouse, Adia, EIG, Mubadala and Itausa did not immediately comment on the matter. BlackRock declined to comment.

The weakening of the Itausa and Mubadala groups raises the chance of Engie, which was the winner of the first bid round, winning the deal.

The sale of TAG is expected to be the largest divestment in Petrobras’ asset sale program. The oil company expects to fetch around $8 billion.

(Reporting by Tatiana Bautzer; Editing by Susan Thomas)

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