Jul 25, 2011 - Biofuel maker Brasil Ecodiesel (SAO:ECOD3) closed stable in Sao Paulo on Friday, at BRL 0.72, after Spanish tycoon Henrique Banuelos pulled out of the company, paving the way for its merger with local agricultural company Vanguarda Participacoes SA.
Last Thursday, the Vila Rica I fund, controlled by Veremonte do Brasil investment fund, in turn property of Banuelos, sold its entire remaining 11.16% stake in Brasil Ecodiesel. Last month, Vila Rica had already sold 8.79% of its interest in the company.
In the current transaction, a total of 120.9 million ordinary shares were sold, the bulk of which, or 108 million were bought by Brasil Ecodiesel's shareholder Helio Seibel, who increased his participation in the company to 17.86%.
Thus, if the merger of Brasil Ecodiesel with Vanguarda is implemented, Banuelos, who has 50% stake in the latter, will hold about 30% in the new company, and not more than a 50% stake, as would be the case if the Spanish investor had not sold his participation in the biofuel maker.
The proposed merger had come to a deadlock over a dispute between Banuelos and another major investor, Silvio Tini, from Bonsucex Holding, who was opposing the deal due to fear of diluting his stake, as Banuelos was owner of considerable portion of the capital of both companies.
(BRL 1 = USD 0.645/EUR 0.449)
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