Read this Wednesday’s edition of the FolhaMercado newsletter (3) – 04/03/2024 – Market

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Panels turned into fence

Commonly seen on rooftops, solar panels are also being used to build garden fences in European countries.

This is the most recent example of the oversupply of this equipment, whose supply will reach 1,100 gigawatts by the end of this year. The amount represents three times the current demand forecast, estimates the International Energy Agency.

Why did the panels become fences?

1. They are very cheap. Chinese mass manufacturing dropped the price of equipment to 11 cents/watt at the end of March, half the price compared to last year.

1. Installation labor is expensive. Homeowners are therefore putting up the panels as fences, even though they capture less light than on roofs.

↳ Installation is do-it-yourself style, with kits that come with instructions – the energy generated, however, is not enough to supply the entire house.

Prices are expected to fall furtherbut this is not a reason for celebration among all agents in the sector.

Panel makers in Europe and the US are calling on local governments to either subsidize domestic production or place an additional tax on equipment coming from China, arguing that current prices make investment unfeasible.

• Beijing has been expanding industry incentives in a plan for solar panels, electric cars and lithium batteries to replace the “old trio” of clothing, furniture and household appliances.

Is here? The price of solar panels fell by more than 50% last year, and the energy source – the second largest in the Brazilian matrix – became an alternative for small businesses and even households.

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Proposed merger between the Stock Exchange’s ‘junior oils’

The oil company Enauta (formerly Queiroz Galvão Exploração e Produção) proposed a merger with competitor 3R Petroleum, amid a global consolidation movement in the sector.

Enauta’s proposal: exchange of shares between the two companies. The new company would be made up of 53% shareholders from 3R and 47% from Enauta.

• The offer states that it includes a premium of 12% over the market value of 3R at the closing value of Monday (1st).

• The combined market value of the two companies would be around R$ 15.65 billionin what would be the third largest in the sector on the Stock Exchange – behind Petrobras and Prio (formerly PetroRio).

The market reaction: Enauta shareholders did not like the proposal, overturning 11% the oil company’s share price. 3R shares jumped 7%, but closed with a timid advance, 0.73%.

The operation strategy: The idea is to create a company that is more relevant in the market to the point of being financed at lower rates than those practiced today and taking advantage of synergies between operations.

In the proposal, Enauta states that the potential production of the two exceeds 100 thousand barrels of oil with the opportunity for compound growth over the next 5 years, and the operated reserves would exceed 770 million barrels.

• For reference, Petrobras produces 2.93 million barrels per day, and Prio, 100 thousand.

Consolidation of the sector: Enauta and 3R are two of the so-called “junior oils”, smaller companies that grew stronger following the purchase of Petrobras assets during the last two governments.

↳ Abroad, two acquisitions worth more than US$50 billion each were announced last year. They showed that the sector is optimistic about the demand for oil in the future, even in the face of pressure from organizations and governments for the energy transition.

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Youngest billionaire is Brazilian

Forbes’ traditional annual ranking of billionaires was released this Tuesday with a record number of people with wealth exceeding nine figures: 2,781 in the world, who have a fortune of US$231 billion in equity.

The list headed by Bernard Arnault (LVMH), Jeff Bezos (Amazon) and Elon Musk (Tesla) brought something new.

The youngest billionaire in the world is a Brazilianaccording to the magazine’s criteria, which mainly consider shareholding in companies listed on the Stock Exchange.

↳ Livia Voigt, 19, has a net worth of US$1.1 billion (R$ 5.5 billion) and is the granddaughter of Werner Ricardo Voigt, one of the founders of Weg (alongside Eggon João da Silva and Geraldo Werninghaus – all three now deceased).

• Headquartered in Jaraguá do Sul (SC), the manufacturer of electric motors and generators is the sixth largest company on the Brazilian Stock Exchange, with R$159.4 billion in market value.

• The company is indirectly controlled by the three families, and the heirs – who number dozens of billionaires – have an additional combined share of 14.5% direct participation.

The 5 biggest billionaires…

↳ From the world:

• Bernard Arnault (LVMH) – $226.6 billion
• Jeff Bezos (Amazon) – US$198.4 billion
• Elon Musk (Tesla) – US$ 195.3 billion
• Mark Zuckerberg (Goal) – $177 billion
• Larry Ellison (Oracle) – $141 billion

↳ From Brazil:

• Eduardo Saverin (co-founder of Facebook) – US$ 28 billion
• Vicky Safra (Banco Safra) – US$ 20.6 billion
• Jorge Paulo Lemann (3G Capital) – US$ 16.4 billion
• Marcel Herrmann Telles (3G Capital) – US$ 10.9 billion
• Carlos Alberto Sicupira (3G Capital) – US$ 8.9 billion

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