Brazilian Oil Giant Petrobras Delays Offering

Chris V. Nicholson
The New York Times
6/23/2010

Petrobras, the Brazilian national oil company, said on Tuesday that it would defer a rights issue worth up to 150 billion reais ($85 billion) until September pending a government decision to evaluate certain oil assets.

The Petrobras offering, on track to be the largest worldwide this year, was set for the end of the month and is intended to capitalize the company to finance its exploration of so-called pre-salt fields in deep waters off the coast of Brazil, where some oil reservoirs are buried below a salt stratum.

The postponed issue, approved by shareholders the same day, will offer up to 60 billion reais ($34 billion) worth of preferred shares and up to 90 billion reais ($51 billion) in common stock — much larger than previously reported.

Petrobras has said that it needs to raise $58 billion in the coming years to finance its 2010-14 business plan, which calls for investments of $224 billion.

The article continues at The New York Times.

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