Dec 15 (Reuters) – Brazilian petrochemical producer Braskem said on Monday that conglomerate Novonor has signed an agreement to sell its controlling stake in the company to private equity firm IG4 Capital.
Under the deal, IG4 will share control of Braskem with state-run oil giant Petrobras , the company’s second-largest investor. Novonor is set to retain a 4% stake, a securities filing showed.
A new controlling shareholder could help boost Braskem’s prospects as it has grappled with tight petrochemical margins and ongoing liabilities tied to damage from salt mining operations in Maceio, northeastern Brazil.
IG4 agreed to purchase about 20 billion reais ($3.71 billion) in Novonor credit held by some of Brazil’s largest lenders and secured by Braskem shares, the private equity firm said.
Novonor will in turn transfer its controlling shares of the petrochemical firm to an IG4 investment fund.
Reuters first reported late last year that Brazil’s government and major banks were working on a plan to transfer Novonor’s Braskem stake to a private equity fund.
The deal may finally ease Novonor’s heavy debt burden, which swelled during the “Car Wash” corruption scandal a decade ago, when the group – then known as Odebrecht – pledged its Braskem shares as collateral for billions of reais in loans.
Novonor has long sought to sell its controlling interest in Braskem but so far had repeatedly failed to close a deal, including recent talks with businessman Nelson Tanure, known for investing in distressed companies.
“Braskem’s current management team and existing advisors remain unchanged, ensuring full operational continuity,” IG4 said. “In parallel, preparatory work is underway to support a comprehensive turnaround.”
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