Lefosse Advogados in São Paulo has helped private equity company EIG complete a public tender offer for outstanding shares worth 452 million reais (US$136 million) in its subsidiary Prumo, paving the way for the logistics company's delisting.
Prumo relied on Paul Hastings LLP in São Paulo and Veirano Advogados in Rio de Janeiro for the transaction which closed on 9 March. The banks hired Pinheiro Neto Advogados in São Paulo.
Prumo's shares were purchased by EIG for 11.50 reais (US$3.50) each. In total, 39,000,000 shares were sold. This increased the private equity outfit's 80.2% stake in the company as lead controlling shareholder by another 10.5%.
EIG needed two-thirds of Prumo's minority shareholders to accept the deal which it obtained after raising its price offer following complaints from shareholders. It originally offered 9.9 reais (US$3) per share.
EIG's decision to make the tender offer and deregister Prumo as a publicly-listed company comes after the logistics provider was unable to use the capital markets as a source of funds. Prumo suffered a net loss of 237 million reais (US$71 million) in 2016 and 989 million reais (US$294 million) in 2017.
Prumo has been divesting assets recently. Earlier this year, it sold a 30% stake in a Rio de Janeiro state LNG facility to BP for US$7.5 million. However, Prumo is still taking out debt to finance its projects. Recent reports suggest that its subsidiary Gás Natural Açu is in talks with the World Bank's International Finance Corporation for a loan to finance the construction of a thermal power plant in Rio de Janeiro state. The plant would power the massive port of Açu, which Prumo's subsidiary operates.
Counsel to EIG LLX Holdings
Partners Carlos Mello and Felipe Gibson, and associates Marcelo Tourinho and Maria Julia Person Argollo in São Paulo
Counsel to Prumo
Paul Hastings LLP
Partner Steven Sandretto in São Paulo
Partners Robson Goulart Barreto, Carlos Lobo and Julio Dubeux, and associates Bruno Sousa, Vitor Rozenthal, Roberta de Carolis, Pedro Salgueiro Figueiredo and Bianca Napoli in Rio de Janeiro
Counsel to Bradesco BBI and Santander
Pinheiro Neto Advogados
Partners Guilherme Sampaio Monteiro and Fernando Dos Santos Zorzo, and associate Ricardo Guimarães Barros in São Paulo