Brazil's Ultrapar taps BTG for possible Ipiranga stake sale, Chevron interest reported

Two people familiar with this process said that Brazilian?conglomerate Ultrapar?has?tapped??investment banking BTG Pactual to handle the sale of a potential stake in fuel distributor Ipiranga.

The?Brazil Journal had reported earlier in the day that oil company Chevron and Ultrapar were in advanced negotiating?talks for a 30% stake of Ipiranga. Two sources said they couldn't confirm whether Chevron was one of the potential buyers.

Ultrapar, according to two additional sources who asked to remain anonymous because the discussion is 'confidential', wants to reduce its exposure in fuel distribution.

One source stated that the company plans to reallocate its capital towards the logistics sector. However, it will still maintain operational control over Ipiranga, even with a smaller ownership stake if possible.

A possible deal with Chevron would be built on a relationship that already exists between the two companies. Chevron already has a joint venture with Ipiranga in the lubricants industry, according to one source. This makes discussions about Ipiranga's ownership a "natural progression."

The same source warned, however, that Ultrapar could be exploring?options with multiple potential buyers.

Chevron, Ultrapar and BTG representatives declined to comment.

(source: Reuters)