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Petrobras (PBR) Gets Shareholder Approval for Liquigas Sale
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Brazilian state-run integrated energy player Petroleo Brasileiro S.A. or Petrobras (PBR - Free Report) announced that shareholders have approved the sale of the company’s subsidiary, Liquigas Distribuidora S.A. The decision was taken in the recently held Extraordinary General Meeting. The unit would be sold to local fuel and petrochemical holding firm, Ultrapar Participacoes SA (UGP - Free Report) , in a deal amounting to R$2.67 billion or $819 million. The closure of the deal is still contingent on the negotiated preceding terms and conditions.
Petrobras had also announced the divestiture of two other subsidiaries, Suape and Citepe, to Mexico’s Alpek in a deal worth $385 million in late 2016. These units have not been profitable for the company and had led to negative cash flow, requiring regular capital infusion. However, the sale of these units was not included in the agenda of the shareholder meeting as the court has decreed suspension of the sale of these petrochemical units. If the sale is not implemented, Petrobras would have to close the Citepe-Suape Complex as the additional capital requirement is a burden on the company. Petrobras is taking measures to protect shareholders' interest.
These divestiture transactions are in sync with Petrobras’ strategic management plan of 2017–2021 to move out of the petrochemical and LPG distribution business. Further, the company has ambitious asset sales plan of $19.5 billion for 2017–2018 to mitigate its debt/EBITDA ratio to 2.5 times by 2018.
Petrobras is Brazil’s largest energy firm operating in segments like exploration, refining, marketing, transporting, distribution and biofuels. The company currently carries a Zacks Rank #3 (Hold).
The company outperformed the Zacks categorized Oil & Gas Emerging Markets Integrated industry over the last six months. During the aforesaid period, shares of Petrobras rose almost 30% while the broader industry gained around 20%.
In the preceding four quarters, Crescent reported an average positive earnings surprise in all four quarters with an average of 1,041.05%.
RPC is expected to report year-over-year earnings growth of 438.37%.
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Petrobras (PBR) Gets Shareholder Approval for Liquigas Sale
Brazilian state-run integrated energy player Petroleo Brasileiro S.A. or Petrobras (PBR - Free Report) announced that shareholders have approved the sale of the company’s subsidiary, Liquigas Distribuidora S.A. The decision was taken in the recently held Extraordinary General Meeting. The unit would be sold to local fuel and petrochemical holding firm, Ultrapar Participacoes SA (UGP - Free Report) , in a deal amounting to R$2.67 billion or $819 million. The closure of the deal is still contingent on the negotiated preceding terms and conditions.
Petrobras had also announced the divestiture of two other subsidiaries, Suape and Citepe, to Mexico’s Alpek in a deal worth $385 million in late 2016. These units have not been profitable for the company and had led to negative cash flow, requiring regular capital infusion. However, the sale of these units was not included in the agenda of the shareholder meeting as the court has decreed suspension of the sale of these petrochemical units. If the sale is not implemented, Petrobras would have to close the Citepe-Suape Complex as the additional capital requirement is a burden on the company. Petrobras is taking measures to protect shareholders' interest.
These divestiture transactions are in sync with Petrobras’ strategic management plan of 2017–2021 to move out of the petrochemical and LPG distribution business. Further, the company has ambitious asset sales plan of $19.5 billion for 2017–2018 to mitigate its debt/EBITDA ratio to 2.5 times by 2018.
Petrobras is Brazil’s largest energy firm operating in segments like exploration, refining, marketing, transporting, distribution and biofuels. The company currently carries a Zacks Rank #3 (Hold).
The company outperformed the Zacks categorized Oil & Gas Emerging Markets Integrated industry over the last six months. During the aforesaid period, shares of Petrobras rose almost 30% while the broader industry gained around 20%.
Better-ranked players in the industry include Crescent Point Energy Corporation (CPG - Free Report) and RPC, Inc (RES - Free Report) Both these companies currently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
In the preceding four quarters, Crescent reported an average positive earnings surprise in all four quarters with an average of 1,041.05%.
RPC is expected to report year-over-year earnings growth of 438.37%.
Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time? Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades >>