Petrobras to sell 90% of NTS business unit for $5.19bn

Petróleo Brasileiro (Petrobras) has approved the sale of 90% shares of its Nova Transportadora do Sudeste (NTS) natural gas business division to Canadian-based Brookfield Infrastructure Partners (BIP) and its affiliates for $5.19bn.

The unit was created in accordance with the statement of commitment signed with the National Agency of Petroleum, Natural Gas and Biofuels (ANP).

In the statement, Petrobras proposed to restructure its wholly owned subsidiary Transportadora Associada de Gás (TAG) to create a single gas transportation company in South East Brazil (NTS) and another in the North and North East (TAG).

Petrobras said that the transaction will open opportunities for partnerships with other companies that have good experience and investment conditions.

Furthermore, it will foster new investments to expand gas transportation infrastructure in a bid to create a model of deverticalisation of the natural gas chain.

It is also important for the Petrobras’ divestment plan, corresponding to roughly 35% of the $15.1bn target for 2015 to 2016.

The first instalment of the total amount will be $4.34bn paid at the closing of the transaction, while the remaining $850m is to be paid in five years.

Petrobras carried out the sale process for NTS through a competitive process.

The transaction is subject to the approval at Petrobras general shareholder´s meeting and to certain usual precedent conditions, in addition to approval by the regulatory entities.

Brookfield has more than $200bn under management in energy and infrastructure assets and a portfolio that includes companies with more than 14,000km of pipelines in the US, Canada and Australia.