Braskem: controllers disapprove offer of Arabs – 05/12/2023 – Panel SA

The offer to buy Braskem made by the Apollo fund and the Arab state-owned company Adnoc did not pass the scrutiny of Novonor (formerly Odebrecht) nor the Petrobras leadership. Shareholders have already sent messages to the Arabs and to the Apollo fund that they are evaluating other possibilities.

For the controllers, the final value of the offer would yield shareholders between R$27 and R$30 per share. This is because the proposed value of R$47 per share is not the net value of the operation.

In detail, only R$ 20 per share will be paid in cash. The remainder (R$ 27) will be paid as follows: R$ 20 per share with perpetual debentures (debt securities) issued by the applicants, adjusted at 4% per annum; and another R$7 per share in cash, depending on Braskem’s performance under the new management.

In the opinion of shareholders, the value of the debentures during the negotiation period would be eroded by the Selic (13.75% per year) and to receive the extra R$7, the company’s share would need to be worth R$70, something considered impracticable.

Therefore, the two main shareholders —Novonor (which owns just over 50% of the shares) and Petrobras (38%)—don’t even want to sit at the negotiation table.

With Diego Felix

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