Mergers & Acquisitions

Ultrapar subsidiary, Ipiranga, acquires Alesat Combustiveis

Ultrapar subsidiary, Ipiranga, acquires Alesat Combustíveis
Photo courtsy of Alesat Combustíveis.

Ultrapar Participações S.A., a multi-business company engaged in the specialised distribution and retail (Ipiranga/Ultragaz/ Extrafarma), specialty chemicals (Oxiteno) and storage for liquid bulk (Ultracargo), based in Sao Paulo, Brazil, announced that its subsidiary, Ipiranga Produtos de Petróleo S.A., has signed a sale and purchase agreement for the acquisition of 100% of Alesat Combustíveis S.A. (ALE) and its assets.

The total value of the acquisition is BRL 2,168 million (USD 633.44 million). The amount to be paid to the sellers will be net of Alesat Combustíveis’ net debt as of December 31, 2015 and is subject to working capital and net debt adjustments as of the closing date of the transaction.

The completion of the acquisition is subject to certain customary conditions for this type of transaction, including the approval by the Brazilian Antitrust Authority (Conselho Administrativo de Defesa Econômica – CADE) and Ultrapar shareholders.

Ipiranga, Brazil’s second largest fuel distributor, has a network of 7,241 service stations, while Alesat Combustíveis is the fourth largest, with about 2,000 service stations. The acquisition would help Ipiranga expand in the northeast, as well as catapult it to the top, above Petrobras Distribuidora, the distribution and sales arm of state-owned Petroleo Brasileiro (Petrobras), which  has about 7,500 service stations.

Last year, Alesat Combustíveis sold 4.3 million cubic meters of diesel fuel, gasoline, ethanol and natural gas, with revenues of BRL 11.4 billion (USD 3.33 billion) and earnings before interest, taxes, depreciation and amortization of BRL 275 million (USD 80.35 million).

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