Transportadora Associada de Gas Divestiture (90%)

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The project involves the acquisition of a 90% stake in Transportadora Associada de Gás SA (TAG), the largest natural gas transmission network owner in Brazil, from Petróleo Brasileiro SA (Petrobras). TAG owns 4,500 KM of gas pipelines in Brazil, which represents 47% of the country’s entire gas infrastructure. Petrobras, a state-controlled company, will retain a 10% stake in TAG. Following a competitive bidding process, the winning offer in the amount of $ 8.6 billion (BRL 33.5 billion) was made by Aliança Transportadora de Gás SA. Aliança Transportadora de Gás's ownership is as follows: ENGIE SA holding a 32.5% direct stake, ENGIE Brasil Energia holding a 32.5% stake and la Caisse de dépôt et placement du Québec (CDPQ) holding a 35% stake. Given that ENGIE Brasil Energia is 68.7% stake owned by ENGIE, ENGIE’s direct and indirect stake in TAG amounts to 49.3%. The consideration paid for the transaction is $ 8.6 billion (EUR 7.7 billion), of which EUR 5.3 billion or $ 5.945 billion is financed via long-term and non-recourse debt in local and foreign currencies and EUR 2.4 billion or $ 2.692 billion come from equity contributions (EUR 800 million or $ 897 million from each sponsor). The debt:equity ratio is 70:30. Some of the banks involved the deal are BNP Paribas Crédit Agricole, ING, Mizuho, MUFG, Société Générale, SMBC, Banco do Brasil, Itau BBA and Bradesco. The acquisition closed on 13 June 2019 after receiving approvals from the relevant governance bodies of Petrobras and of Conselho Administrativo de Defesa Econômica (CADE) (the Brazilian anti-trust authority) and European Union anti-trust authorities. https://www.engie.com/en/journalists/press-releases/consortium-competitive-bidding-brazil-acquisition-tag/ https://www.engie.com/en/journalists/press-releases/tags-acquisition-financial-impacts/ https://www.engie.com/wp-content/uploads/2019/06/tag-closing-engie-presentation-vdef.pdf https://www.cdpq.com/en/news/pressreleases/engie-and-cdpq-make-the-winning-bid-in-the-process-to-acquire-tag https://www.investidorpetrobras.com.br/enu/14990/FR-Closing-TAG-Ingles.pdf https://ijglobal.com/articles/140703/details-emerge-on-tags-acquisition-financing