Braskem announces raising of a US$ 1.2 billion loan to acquire Ipiranga
Group’s petrochemical business
Financial strength and market confidence in Braskem’s growth initiatives ensures an extremely
São Paulo, Brazil April 12, 2007 --- BRASKEM S.A. (BOVESPA: BRKM5; NYSE: BAK; LATIBEX: XBRK), leader in the thermoplastic resins segment in Latin America, announces the conclusion of negotiations which will guarantee the raising of up to US$ 1.2 billion through a bridge loan to finance the acquisition of Ipiranga Group’s petrochemical business jointly with Petrobras and the future delisting of Copesul, two exceptionally important assets in Braskem’s strategy of growth with value creation and consolidating the petrochemical sector in the south of Brazil.
“The positive market evaluation about the new size of the Company, the synergies to be captured and the strategic benefits resulting from the Ipiranga acquisition, combined with the confidence in Braskem’s financial strength, proved crucial to the success of the operation”, says Carlos Fadigas, CFO and Investor Relations Director. According to Mr. Fadigas, the company raised the funds in a highly favorable market scenario, with excellent
liquidity, guaranteeing attractive borrowing conditions and financial flexibility to Braskem.
The 2-year credit facility will be repaid at 0.35% above the Libor rate in the first year and 0.55% above the Libor in the second, making this transaction the most competitive ever in Brazil. The transaction was structured and led by ABN AMRO Real, Calyon and Citibank.
Braskem expects to conclude the refinancing of the bridge loan at the appropriate moment, while always maintaining its focus on reducing the Company’s cost of capital and ensuring a debt profile that is suitable to its cash flow. Braskem’s net debt/EBITDA ratio, which measures its degree of financial leverage and is currently 2.7x, will be virtually unaffected by this acquisition.
Braskem, a world-class Brazilian petrochemical company, is the leader in the thermoplastic resins segment in Latin America, and is the second largest Brazilian industrial company owned by the private sector. The company operates 14 manufacturing plants located throughout Brazil, and has an annual production capacity of 6.1 million tons of petrochemical and chemical products.
Forward-Looking Statement Disclaimer for U.S. Securities Law Purposes
This press release contains statements that are forward-looking within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements are only predictions and are not guarantees of future performance. Investors are cautioned that any such forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the operations and business environments of Braskem and its subsidiaries that may cause the actual results of the companies to be materially different from any future results expressed or implied in such forward-looking statements.
Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, the risks and uncertainties set forth from time to time in Braskem reports filed with the United States Securities and Exchange Commission. Although Braskem believes that the expectations and assumptions reflected in the forward-looking statements are reasonable based on information currently available to Braskem management, Braskem cannot guarantee future results or events. Braskem expressly disclaims a duty to update any of the forward-looking statements.
For further information visit our website at www.braskem.com.br/ir or contact the IR team:
Phone:(+55 11) 3576 9178
firstname.lastname@example.org Luiz Henrique Valverde
Phone:(+55 11) 3576 9744
email@example.com Silvio Nonaka
Gerente de RI
Phone:(+55 11) 3576 9471