Brazil energy firms 3R Petroleum, Enauta reach deal to merge (updated)
17/05/2024 13:55
(Adds context, share reaction in paragraph 10)
SAO PAULO, May 17 (Reuters) - Brazilian energy companies
3R Petroleum RRRP3.SA and Enauta ENAT3.SA have reached an
agreement to merge in an all-stock deal, they said on Friday,
establishing what they describe as a firm with "large growth
potential" in the coming years.
The companies had been in talks since Enauta last month
presented an offer to combine with 3R, halting 3R's talks for a
tie-up with rival PetroReconcavo RECV3.SA .
Smaller Brazilian oil companies are looking for
opportunities to consolidate following years of growth driven by
purchases of assets previously owned by state-run oil giant
Petrobras PETR4.SA .
Enauta has said that combining with 3R would create "one of
the most diversified independent oil and gas companies in Latin
America," potentially producing more than 100,000 barrels of oil
equivalent per day.
Under the deal, which now requires the green light from
shareholders of both companies and Brazil's antitrust watchdog
CADE, Enauta shares would be incorporated by 3R. That would
leave 3R shareholders with 53% of the combined company, while
Enauta investors would own 47%.
3R minority shareholder Maha Energy MAHAa.ST , which
spearheaded efforts for a deal with PetroReconcavo, will receive
an additional 2.2% stake in the combined firm.
According to a joint securities filing, Enauta Chief
Executive Decio Oddone will be the CEO of the combined company,
with 3R Chief Financial Officer Rodrigo Pizarro maintaining his
role.
Enauta has a market capitalization of 6.49 billion reais
($1.27 billion) while 3R's market cap currently stands at 7.07
billion reais, according to LSEG Workspace data.
Shares in 3R rose 3.6% after the announcement, while Enauta
was up 1.6%. The benchmark Bovespa index .BVSP was flat.
($1 = 5.1198 reais)
(Reporting by Luana Maria Benedito and Gabriel Araujo; Editing
by Kirsten Donovan)
((Gabriel.Araujo2@thomsonreuters.com; +55 11 5047-3352;))