BRASILIA, April 6 (Reuters) - A Grupo BTG Pactual SA-led investment vehicle has agreed to transfer control of Brazilian drugstore chain BR Pharma SA to an investor, exiting a company that struggled with rising debt and subpar performance in recent years.
Under terms of the transaction, which BTG Pactual unveiled in a Thursday securities filing, the BTG Pactual vehicle transferred about 94 percent of BR Pharma to Lyondel LLC for the price of 1,000 reais ($318.20).
Lyondel, which is linked to investor Paulo Remy, according to a source with knowledge of the matter, will also subscribe a capital increase in BR Pharma and buy part or all of 400 million reais of new BR Pharma debt, the filing said.
BTG Pactual’s vehicle will buy the remainder of the debt issued that fails to be subscribed by Lyondel, the filing said.
Reuters reported on March 9 that BTG Pactual was in advanced to transfer control of BR Pharma.
BR Pharma, the byproduct of a series of acquisitions speaheaded by BTG Pactual and partners since 2009, succumbed to a rising debt burden, a prolonged recession in Brazil that is entering a third year and heightening competition.
The deal marks BTG Pactual’s latest exit from a series of buyouts that turned out problematic a couple of years ago as the economy slumped, and soured even further when the bank’s founder and former chief executive officer, Andre Esteves, was arrested as part of a widening corruption investigation in Brazil.
Creditors of debt-laden companies like BR Pharma have been demanding ownership changes in order to stem defaults and curb the large loan-loss provisioning that caused their profits to decline last year for the first time since 2009.
Such tack also has helped reduce the probability that those companies end up filing for bankruptcy protection. Requests to file for creditor protection in Brazil fell 21 percent in the first three months, credit research firm Experian Plc said on Thursday. ($1 = 3.1427 reais) (Reporting by Guillermo Parra-Bernal and Tatiana Bautzer; Editing by Bill Trott)