BTG Pactual to seek sale of stake in Petrobras Africa venture

Bloomberg

Grupo BTG Pactual, the Brazilian bank that was forced to sell assets after the arrest of its founder last year, is exploring the sale of its 50 percent stake in an African joint venture with state-run oil company Petroleo Brasileiro SA, according to people with knowledge of the matter.
BTG has held sales talks with independent oil explorers who have a presence on the continent as well as local companies, the people said, asking not to be identified as the information is private. The lender’s investment banking unit has been handling the discussions with prospective buyers, the people said. There is no guarantee that the talks will lead to an agreement, the people said.
The Sao Paulo-based bank entered into a venture with Petrobras in 2013 and paid $1.5 billion for a 50 percent stake in the oil firm’s Africa division. The African operations came under scrutiny in March this year after a Brazilian senator said in a plea-bargain deal that BTG underpaid for the oil assets. BTG has said its offer was the highest in an auction in which 14 other players were invited to participate. BTG’s shares climbed 2.6 percent Friday to 18.98 reais in Brazil trading, giving the company a market value of about 17.4 billion reais ($4.9 billion).
BTG’s founder and then-Chief Executive Officer Andre Esteves was arrested in November in connection with a sweeping corruption investigation in Brazil. The billionaire, who had denied any wrongdoing, was later released and returned to the firm as a senior partner and adviser in April. Petrobras itself has been at the center of a scandal where high-ranking company executives allegedly colluded with contractors to overcharge for projects in order to pay kickbacks and help finance political campaigns.
BTG’s investment in the venture gave the lender a stake in assets in Angola, Benin, Gabon, Namibia, Nigeria and Tanzania. A representative for BTG declined to comment.