Funcef and FI-FGTS acquire a 20.7% stake in Odebrecht Engenharia Ambiental
Related M&A Transactions
According to local sources, Brazilian state-owned bank Caixa Economica Federal (CEF) and local pension fund Fundacao dos Economiarios Federais (Funcef) signed a deal to acquire a 20.7% stake in Brazilian water and sewage treatment company Odebrecht Engenharia Ambiental for R$615 million (US$264.6 million) through a capital increase.
CADE, Brazilian competition regulator, approved the deal on 16 December 2013.
Under the agreement, Funcef will acquire a 17.24% stake in Odebrecht Ambiental for R$300 million (US$129.1 million). Caixa Economica Federal through its infrastructure investment fund Fundo de Investimento do Fundo de Garantia do Tempo de Servico (FI-FGTS) will subscribe new shares issued by Odebrecht Ambiental for R$315 million (US$135.5 million) and will increase its stake from 26.5% to 30% of company's capital.
The raised funds will support Odebrecht Ambiental's strategy to invest in three main segments: water and sewage services to residential customers, industrial effluents treatment and miscellaneous waste management services.
Odebrecht Ambiental, created in 2008 as the sanitation services arm of Odebrecht. The company posted R$1.3 billion (US$678.1 million) in revenues and a net income of R$76.3 million (US$39.1 million) in 2012.
FI-FGTS focuses on infrastructure investments in the energy, highway, railway, port and sanitation sectors in Brazil. Since its inception in 2007, the fund has invested R$22.4 billion (US$10.9 billion) in infrastructure projects in the country.
Funcef is the third largest pension fund in Brazil with R$52 billion (US$24 billion) in assets under management, responsible for the management of the pension funds of the employees of Brazilian bank Caixa Economica Federal.