Bolivia’s government has nationalied Glencore International’s Colquiri mine, Glencore says, with immediate effect. The move comes after negotiations to increase the government’s take of the profits to 77%-79% fell through. Colquiri has been developed and operated by Sinchi Wayra, a company owned by Glencore, since 2005. Last year, Glencore withdrew a $475m offer for CST Mining Group’s interest in Peruvian copper project Mina Justa, following a failure to agree on an offtake deal. In May, Bolivia’s government nationalized its electricity grid, with the government’s Empresa Nacional de Electricidad (ENDE) absorbing 99% of the shares of Empresa Transportadora de Electricidad, previously owned by Spain’s Red Electrica.
Category: M&A
Posted inDaily Brief
US E&P Exits Vene
Harvest Natural Resources has agreed to sell its 32% stake in a Venezuelan oil exploration project to Indonesia’s PT Pertamina for $725m, it says. The all-cash sale concludes a process that the US-based oil company had initiated in March. In the deal, PT Pertamina acquires the stake in the Petrodelta project, of which PDVSA is a partner, by buying Harvest’s 80% stake in Harvest-Vinccler Dutch Holding BV. Net proceeds are expected to be $525m. The transaction is subject to government approval in Venezuela and Indonesia, as well as by shareholders. The boards of Harvest and Pertamina have each approved the transaction. As of end 2011, the Petrodelta venture controls roughly 194m barrels of oil in 3P reserves, a combination of proved, probable and possible reserves held underground, a 1% decline from 2010, following Harvest’s reserve review.
Posted inDaily Brief
AMX Continues Raising KPN Stake
America Movil (AMX) has raised its stake in Dutch telecom KPN by 8.7%, through further share purchases, bringing its holdings to 20.92%, it says. The Mexican telecom is trying to increase its participation in KPN to gain a bigger foothold in Europe, and launched a public tender for 325m shares to give it as much as 27.7%, running through June 27. Despite AMX insisting it does not seek a full takeover, KPN has attempted to thwart the offer. Deutsche Bank is advising AMX. Last week AMX agreed to pay $1bn for a minority stake in Telekom Austria, a move which was welcomed by the target.
Posted inDaily Brief
Camargo Completes Cimpor Takeover
Brazil’s Camargo Correa has completed the takeover of Portugal’s Cimpor, ending up with 94.8% of the cement maker at the close of a public offer period, Cimpor says. The successful bid concludes a process started in March when Camargo Correa, starting with a 33% stake, bid for the rest, offering up to $2.5bn ($1.97bn), at EUR5.50 per share. At the time of the offering, Camargo’s InterCement unit planned, if successful, to unify all of its cement operations under Cimpor. InterCement would first transfer to Cimpor all of its assets in South America and Angola, in exchange for most of Cimpor’s assets in China, Spain, India, Morrocco, Tunisia, Turkey and Peru. InterCement would then offer those international assets to Votorantim in exchange for its 21.2% of Cimpor’s shares.
Posted inDaily Brief
Mizuho Gets WestLB Brazil
Mizuho has agreed to acquire WestLB’s Brazilian subsidiary, it says. The company did not respond to request for comment regarding the value, but Japanese and other media reports put it in the neighborhood of JPY30bn ($380m). The deal, which remains subject to regulatory approvals, comes as Germany-based bank WestLB restructures in a plan approved by the European Commission late last year that instructs WestLB to split off its business with savings bank and public-sector clients and gives it the option to sell other segments until June 30. WestLB do Brasil had about $1.5bn in assets as of year-end. Mizuho says the acquisition provides it a local banking platform that will extend its reach in Brazil with both Japanese and non-Japanese customers, specifically in lending and project finance, which have been areas of expertise for the bank.
Posted inDaily Brief
UK Software Provider Buys Brazil Stake
British enterprise software provider Sage Group has purchased a 75% stake in Brazil’s Folhamatic Group for GBP125m ($197m), it says. It will pay GBP101m upfront and a GBP24m performance-driven earn-out on 2012 targets, and a put and call agreement is in place for 2015 for the remaining 25%, based on 2014 performance. “This appears a well structured deal, and Sage has not overpaid for what could become an important seed asset into LatAm,” says a Deutsche Bank report. It and other shops find an implied 13.4x-13.5x Ebitda multiple. The purchase of a market leader which is accretive immediately was desirable for the company, says a person familiar with the deal, giving a 13x Ebitda multiple for transaction. The deal should be 1%-3% accretive in its first full year, according to analyst reports. Sage sees Folhamatic’s 80% recurring revenue, market access in Brazil, along with the room for growth in the SME market as advantageous to its business, according to the company. Folhamatic founder and CEO Mauricio Frizzarin holds the remaining 25% of the equity. Sage, a software and services provider for SME businesses, was advised by Citi.
Posted inDaily Brief
US Chemical Specialist Shops in Chile
US chemicals producer Air Products has agreed to acquire a 67.0% stake in Chilean industrial gas producer Indura for CLP451bn ($884m), it says. The transaction consists of CLP351bn in equity and CLP100bn in debt, and implies an enterprise value to Ebitda multiple of 13x, according to Air Products. The deal is to be completed in 2 stages, which the company declines to specify, noting only that the first portion will give it majority control and close in early July, with the second portion closing within twelve months and bringing its ownership to 67%. Air Products plans to fund the purchase with debt sourced from the US market and converted to pesos, and will have a bridge loan available for 3 months which it does not expect to draw down. The move expands Air Products’ Latin America footprint in a high growth market, and is expected to be accretive to its earnings per share starting in FY2013. There is a put option for the founding Briones family to sell the remaining interest, exercisable at fair market value in year 4 and 5. Indura has annual revenues of more than $478m, with operations in Argentina, Chile, Colombia, Ecuador, Mexico and Peru. Air Products has a presence in Argentina and Brazil and a joint venture in Mexico. It did not disclose its advisors.
Posted inDaily Brief
Argentina Mine Changes Hands
Canada’s Yamana has agreed to acquire Argentina-focused mining company Extorre Gold Mines, in a deal valued at approximately CAD395m ($385m), it says. The transaction gives Yamana the Cerro Moro gold and silver project, located in Argentina’s Santa Cruz province. Extorre shareholders are to receive CAD4.26 per share – CAD3.50 in cash and 0.0467 of a Yamana common share – for each Extorre common share they own. The price represents a 54% premium to Extorre’s 20-day volume-weighted average price. Though the buy represents only 3% of Yamana’s market capitalization, it could contribute to a multiple of that in cash flow growth, the company says. Extorre says it pursued a sale after a decline in gold mining shares, economic uncertainty and the situation in Argentina meant financing Cerro Moro on its own became too expensive. Yamana was advised by Barclays Capital and CIBC World Markets, and Extorre was advised by Canaccord Genuity. The agreement includes a CAD15m breakup fee. Yamana operates in Brazil, Argentina, Chile, Mexico and Colombia.
Posted inDaily Brief
BNDESPar Takes Renova Stake
The board of Brazil’s Renova Energia has approved the sale of a BRL315m ($153m) stake to BNDESPar, Renova says. In the deal the investment arm of the BNDES development bank will buy 112.4m units at BRL28.00 each. Renova units stood at BRL31.49 Monday. Renova is also preparing a BRL300m debenture sale in Brazil’s domestic market.
Posted inDaily Brief
Fench Food Group Adds in Mexico
French food services group Sodexo has agreed to acquire Mexican food, meal voucher and card company Servi-Bonos for EUR60m ($75m), it says. The buy will be financed out of the company’s existing cash balance and undrawn credit facilities. It is made by Sodexo’s motivation solutions business, one of the company’s main areas, which includes vouchers, cards and checks for food, restaurant meals, culture and transport. Company officials were unable to comment on the advisors used. The purchase is subject to regulatory approvals. It follows the acquisition of on-site food services and corporate meal voucher system company Puras do Brasil for EUR525m last year.