Brazil’s largest independent investment bank, Banco BTG Pactual SA, may hold its stake in Petrobras Africa to avoid a loss from the sale, a source familiar with the matter said on Friday. In June, Reuters reported that a consortium led by Vitol, the world’s number one oil operator, had entered into exclusive deals to acquire PetroAfrica, as the company is known, in an estimated bid of up to $ 2.5 billion.
The negotiations would include the 50 percent of Petrobras, 40 percent of BTG and 10 percent of Helios Investment Partners. If PetroAfrica were sold for that price, BTG would have to file a loss, as the bank acquired a 50 percent stake in 2013 for $ 1.5 billion and had to account for a loss by selling the 40 percent it owns now according to the source who could not be identified because the discussions are private.
Although BTG has decided to sell the stake, the bank believes that PetroAfrica will start generating a stable cash flow, soon paying constant dividends to the bank. If Vitol agreed to increase its offer, BTG would be willing to sell it, the source added. BTG, Vitol and PetroAfrica did not immediately comment on the matter.
PetroAfrica is one of the last remaining companies in the BTG Pactual corporate equity portfolio. After its founder, André Esteves, was arrested in late 2015 on corruption charges, the bank was forced to sell assets, and BTG’s partners decided not to hold more liquid holdings in the case of PetroAfrica. In July, a Brazilian federal judge acquitted Esteves. Earlier on Friday, the newspaper Valor Econômico reported that BTG intended to keep its stake in PetroAfrica, but that no decision had yet been made.