Can Mubadala Rejuvenate Brazil’s Invepar?

Brazil, Latin America’s biggest economy, is facing its toughest recession in decades amid a earth-shattering political crisis that linked government officials with state-owned companies.

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Making matters worse for the Brazilian economy is that borrowing costs had surged, while deal execution risk has increased. In February, state-controlled oil giant Petróleo Brasileiro SA (Petrobras) had its sale of its US$ 5.2 billion transaction of a natural gas distribution unit, Nova Transportadora do Sudeste S.A., stopped by a Brazilian judge. The buyers of Nova Transportadora do Sudeste S.A. are Brookfield Infrastructure Partners LP, a unit of Toronto-based Brookfield Asset Management Inc., China Investment Corporation (CIC) and Singapore’s GIC Private Limited. The judge announced the deal wasn’t sufficiently publicized to stimulate competition – this a major setback for Petrobras.

Sovereign funds and large pensions are carefully analyzing the economy, seeking to identify buyouts that commensurate with risk. Abu Dhabi-based Mubadala Development Company is contemplating taking a minority ownership stake in Invepar S.A., a Brazilian infrastructure company. Invepar was formerly known as Investimentos & Participacoes em Infraestrutura SA. Invepar operates airports, toll roads and urban mobility licenses. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]



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