J&F Investimentos SA, which manages investments for Brazil's billionaire Batista family, has agreed to pay 2.67 billion reais (716 million dollars) in cash for a controlling stake in Alpargatas SA (ALPA4.SA), the maker of the Havaianas flip flops.
Under terms of the deal, J&F will pay 12.85 reais per common share and preferred share. Thus, the Batista Family will pay through J&F Investments a premium of about 32 percent for its 44.1 percent stake in Alpargatas to conglomerate Camargo Correa SA, according to a securities filing.
A source close to the deal quoted by Reuters points out that the Alpargatas stake sale is due to Camargo Correa search for a way to dispose of assets in coming months. Earlier this month, Camargo Correa sold a couple of Alpargatas brands to investors, recalls the same source.
The conglomerate's decision to exit part or all of some non-essential businesses aims to create value for shareholders, and not out of a need to raise cash to cut debt or pay fines related to a massive corruption scandal involving the group's engineering firms and state companies, explain sources with knowledge of this disinvestment plan.
Under terms of the deal, J&F agreed to keep Alpargatas listed for at least the first year after the acquisition of the stake.
The deal is still subject to regulatory approval.
In a separate statement, J&F said there is no set date for a mandatory tender offering to minority shareholders, which triggered an 8 percent plunge in preferred shares (ALPA4.SA) of Alpargatas. Its common shares ( ALPA3.SA) gained 3 percent.