Schmidt, Valois, Miranda, Ferreira, Agel Advogados has helped state-owned fuel station operator BR Distribuidora buy a majority stake in local electricity commercialisation group Targus.
Targus relied on Pinheiro Neto Advogados for the deal, which was signed on 26 November.
With the transaction, BR Distribuidora pays 62 million reais (US$12 million) for a 70% equity stake in Targus. The deal’s closure is subject to approval from Brazil’s antitrust authority, CADE.
The deal marks BR Distribuidora’s entry to the power commercialisation sector. The company, which is Brazil’s largest fuel distributor, hopes to expand its footprint in the local and international electricity supply markets with the purchase and will sell power to its existing clients in the fuel industry. Targus’ management team will remain at the business and provide valuable knowledge about the commercialisation of power assets.
The transaction included call and put options, which will allow the buyer to either move forward with the purchase or sell the asset depending on whether its value increases or decreases before the deal’s closing. It also included an earn-out option through which the seller may receive a higher payment if certain financial targets are met by Targus.
BR Distribuidora is Brazil’s largest distributor of biofuel and petroleum-derived energy, with 34,000 fuel stations across the country. It is the subsidiary of state-owned oil giant Petrobras, though the government-owned entity reduced its stake in the business from 71% to 41% last year. The US$2.2 billion share sale formed part of Petrobras’ multibillion-dollar divestment programme.
Targus owns around 200 electricity control centres throughout Brazil and manages some 2 billion reais (US$390 million) worth of power contracts.
Counsel to BR Distribuidora
Partners Paulo Valois Pires and Eduardo Cirne Lima, and associates Lara Lebreiro, Rodrigo Pinheiro, Bruno Guedes, Arthur Mello, Luciana Cotrim and Leonardo Oliveira
Counsel to Targus Energia
Pinheiro Neto Advogados
Partner Carlos Lima and associate Rodolfo Schreuders
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