Brazil's Espirito Santo State to Shed Stake in Gas Distributor

The Brazilian state of Espirito Santo plans to sell a 25% interest in its gas distribution firm ES Gas on the Sao Paulo stock exchange, in what would be the latest in a series of privatisation deals in Brazil's gas sector.

Espirito Santo's government currently holds a 51% interest in ES gas, while fuel distributor BR Distribuidora controls the remaining stake. Both will sell 25% interests on the exchange, with the transactions to be mediated by the National Bank for Economic and Social Development.

"We are going through a challenging time, the consequences of which we will still feel in 2021," ES Gas CEO Heber Resende said. "It is important to move ahead to provide Espirito Santos with a business environment conducive to investment and the generation of jobs and income. The gas sector has a relevant role in this scenario and should not be outside the plan."

Brazil's national oil company Petrobras has shed a number of oil and gas assets over the past year to raise capital to pay off debt and increase competition in the sector. It sold 10% of Brazil's largest gas pipeline company TAG in July to France's Engie and Canadian investment fund Caisse de Depot and Placement du Quebec (CDPQ) in July for $188mn. It is also seeking buyers for its 51% interest in distribution holding group Gaspetro.