Brazil Approves Sovereign Fund, State Banks In Petrobras Capitalization
10. Sep, 2010
According to the Wall Street Journal, “Brazil’s federal sovereign wealth fund and the BNDES and Caixa Economica Federal state-controlled banks will be allowed to participate in the planned capitalization of state-controlled oil company Petroleo Brasileiro (PBR, PETR4.BR) later this month, according to a decree published by government in the country’s federal register Thursday.
Under the decree, BNDES National Development Bank and the Caixa Economica Federal savings and loan bank will be allowed to sell or exchange up to 217,395,982 common shares of Petrobras, as the company is known, with the country’s sovereign wealth fund, which is managed by the state-controlled Banco do Brasil. Later this month Petrobras plans to sell approximately 3.17 billion new shares in a public offering as part of its effort to fund development of offshore oil fields discovered in 2007 off the country’s southeast coast. The share offer is seen raising upwards of 111 billion Brazilian reals ($64 billion) for the company. Following announcement of the share offer last week, Petrobras said the government and its financial units planned to buy at least BRL74.8 billion of its shares. Brazil’s government currently owns 30% of Petrobras’ total shares and more than 50% of its voting shares.”
Read more: Wall Street Journal
