Petrobras to sell assets to clear high debt

Brazil-based oil company Petrobras announced it has sold its stake in Guarani SA-45.97%-to France’s Tereos Internacional for $202m. Guarani is a Brazilian producer of sugar and ethanol from renewable energy. Simultaneously, the company has also sold Petroquimica Suaper and Citepe to Mexico’s Alpek for $385m. Suaper and Citepe manufacture plastic and have a production capacity of 700K mT of PTA (terephthalic acid) and 450k mT of PET (polyethylene terephthalate). Alpek has a sales volume exceeding $5.3bn and already owns a polystyrene production facility in Brazil. The decision addresses the need to reduce the net debt-to-EBITDA ratio, which was 5.3x in 2015 and is expected to reach 2.5x by 2018. Petrobras has sold assets for a total value of $13.6bn in the last two years and is targeting divestitures for $21bn in the next two years. (Source WSJ)