Engie Brasil said it had reached a deal to sell a 15% stake in natural gas pipeline firm TAG to Canadian investment fund Caisse de Depot et Placement du Quebec (CDPQ) for 3.1 billion reais (€586 million).
CDPQ will raise its stake in TAG to 50%, while Engie Brasil will own 17.5% and its French parent company will hold the rest, giving it an indirect 50% stake, Reuters reported.
In 2019, Engie and CDPQ jointly acquired a 90% stake in TAG from state-run oil firm Petrobras for about $8.6 billion (€7.8 billion) at the time, purchasing the remainder the following year.
TAG owns and operates a large part of Brazil's natural gas pipelines with some 4,500 km (2,800 miles) over 10 states in the country that have a firm contracted natural gas handling capacity of 74.67 million cubic meters per day.
The deal, which is expected to close by the end of January pending regulatory approvals, implies an equity value for TAG of 20.8 billion reais (€3.9 billion), according to Engie Brasil.
The proceeds of the sale will be used to implement Engie Brasil's investment plan in renewable energy and transmission lines "without increasing pressure on leverage, ratings and payout," chief financial officer Eduardo Takamori said in a statement.
Engie Brasil sells stake in gas pipeline
