Filer: Ultrapar
Participações
S.A.
Issuer: Ultrapar Participações S.A.
Subject of the offer: Refinaria de Petróleo Ipiranga S.A.,
Distribuidora de Produtos de Petróleo Ipiranga S.A. and
Companhia Brasileira de Petróleo Ipiranga S.A.
Commission File Number: 001-14950
Issuer: Ultrapar Participações S.A.
Subject of the offer: Refinaria de Petróleo Ipiranga S.A.,
Distribuidora de Produtos de Petróleo Ipiranga S.A. and
Companhia Brasileira de Petróleo Ipiranga S.A.
Commission File Number: 001-14950
Petrobras, Ultrapar and Braskem enter into an
agreement to acquire Ipiranga Group operations
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March 19, 2007
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Disclaimer
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This presentation contains forward-looking statements. Such statements are not
statements of historical fact, and reflect the beliefs and expectations of
Petrobras', Ultrapar's and Braskem's management. The words "anticipates",
"believes", "estimates", "expects", "forecasts", "intends", "plans",
"predicts", "projects", "targets" and similar words are intended to identify
these statements, which necessarily involve known and unknown risks and
uncertainties, considering Petrobras, Ultrapar and Braskem information.
Accounting information are updated until December 31, 2006 and Petrobras,
Ultrapar and Braskem are not obliged to update them in light of new information
or future developments.
Petrobras, Ultrapar and Braskem are not responsible for any transaction or
investment decision based on the information contained in this presentation.
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Summary
o Motivation
o Ipiranga Group
o Operation Structure
o Benefits
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Motivation
|X| Reorganization and consolidation of key sectors in the Brazilian economy:
o Fuel distribution sector; o Petrochemical sector.
|X| For Petrobras:
o Increased share in the Brazilian petrochemical sector; o Assured sale of
Petrobras' refined products in the Brazilian domestic market;
o Increased share in renewable fuels in the Brazilian market; |X| For
Ultrapar:
o Operational growth - already the leader in LPG market, it will become
the second largest fuel distribution company in Brazil, with a market
share of around 15%;
o Large scale operating and administrative benefits; o Investment
opportunities with the potential growth of the biofuel
market. |X| For Braskem:
o New phase in the consolidation of the Brazilian petrochemical
industry;
o Increased business size;
o Increased competitiveness through integration of the production
chain;
o Reinforced leadership in thermoplastic resins: PE, PP and PVC.
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Ipiranga Group
Overview
|X| Fuel Distribution
o 4,240 gas stations network in December, 2006; o 2nd largest company in
the sector with a 20% market share.
|X| Petrochemicals
o Annual production capacity of 730,000 tons of petrochemical resins
through IPQ in 2006;
o Brazilian market leader in HDPE with an approximate 33% market share; o
Controls Copesul together with Braskem .
|X| Oil Refining
o Refining capacity of 17,000 barrels/day.
|X| In 2006, Ipiranga Group's consolidated net revenue totaled R$ 30 billion,
EBITDA R$ 1.0 billion and net income R$ 534 million.
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|X| Fuel Distribution Ipiranga Group:
Among the 10 most valuable brands in Brazil(1) Fuel distribution EBITDA Evolution
|X| National presence(1) (except RR and AP):
o DPPI: 916 gas stations in RS and South and West of SC;
o CBPI: 3,324 gas stations in other Brazilian states.
Ipiranga Group: market positioning (1H06)(2):
1 Survey published in Gazeta Mercantil newspaper, March/06
2 Figures from August/06 - Apimec
3 Figures from November/06. Source: ANP (volume)
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Petrochemicals
Relevant position in the Brazilian petrochemical industry
|X| Ipiranga Petroquimica: IPQ - EBITDA Evolution (R$ million)
o 5 industrial plants with a joint resin production capacity of 730
kt/year in 2006:
o PE: 550 kt/year;
o PP: 180 kt/year.
o 16% share of PE market, leadership in HDPE; o Net Revenue of R$ 2
billion; o EBITDA of R$ 184 million in 2006.
|X| Copesul - shared control with Braskem:
o Total production capacity of 3.3 million t/year of basic
petrochemicals, including 1.25 million t/year of ethylene;
o Second largest cracking plant in Latin America; o Net Revenue of R$ 6.4
billion; o EBITDA of R$ 1,147 million in 2006.
Source: Copesul, IPQ and CVM
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Ipiranga Group Corporate Structure
Main Companies
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Description of the Acquisition
|X| Investment agreement between Petrobras, Ultrapar and Braskem;
|X| Stage 1 - Ultrapar acquires the shares held by the controlling shareholders;
|X| Stage 2 - Ultrapar makes a tender offer for the acquisition of common
shares ("tag along"): CBPI, DPPI and RIPI;
|X| Stage 3 - Petrobras and Braskem make a tender offer for the delisting of
Copesul (CPSL);
|X| Stage 4 - Ultrapar incorporates CBPI, DPPI and RIPI preferred shares;
|X| Stage 5 - Ultrapar will sell part of Ipiranga Group's assets to Braskem
and Petrobras;
|X| Conclusion estimated for the 4Q07.
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Post-operation business profiles
|X| Petrobras:
o Fuel distribution operations in the North, Northeast and Midwest
regions, and a 5-year license for the use of the brand;
o 40% of petrochemical assets (IQ / IPQ / CPSL);
o 1/3 of the oil refinery (RIPI in operation)
|X| Ultrapar:
o Fuel distribution operations in the South and Southeast regions and
the Ipiranga brand;
o 1/3 of the oil refinery (RIPI in operation)
|X| Braskem:
o 60% of petrochemical assets (IQ / IPQ / CPSL);
o 1/3 of the oil refinery (RIPI in operation)
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Stage 1 - Acquisition of 100% of the shares held by the controlling shareholders
RIPI - Families
Common 61.6%
Preferred 13.8%
TK Total 29.9%
Refinery
(34% Com./ 66%Pref.)
58.5% Common 58.5% TK
Petrochemical
Assets
15.3% Common
3.8% Preferred
7.7% TK
24.8% Common 4.7% Preferred
11.4% TK
DPPI
(33% Com. / 67%Pref.)
62.9% Common 21.0% KT
CBPI
(33% Com. / 67%Pref.)
DPPI - Families
Common 69.2%
Preferred 13.5%
TK Total 32.1%
CBPI - Families
Common 3.6%
Preferred 0.4%
TK Total 1.5%
41.5% Common
Shareholder Stock Price per Share Total (R$ MM)
CBPI Common - TAG 58.10 74.85
Preferred 20.55 5.44
DPPI Common 140.09 713.54
Common - TAG 112.07 215.15
Preferred 29.57 79.63
RIPI Common 132.85 763.12
Common - TAG 106.28 43.28
Preferred 38.93 105.14
Total 2000.16
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Stage 2 - Control change public tender offers (tag along): CBPI, DPPI and RIPI
Tag Along
Shareholders Price per Share Total (R$MM)
CBPI 58.10 178.38
DPPI 112.07 186.42
RIPI 106.28 406.95
Total 771.75
Stage 3 - Petrobras and Braskem will carry out tender offer for the delisting of
Copesul (CPSL)
Copesul Delisting Tender Offer
Shareholders Price per Share Total
CPSL 37.60 1437.00
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Stage 4 - Ultrapar incorporates CBPI, DPPI and RIPI
o CBPI, DPPI and RIPI preferred shares will be exchanged for Ultrapar
preferred shares. Ultrapar will issue new shares. Holders of CBPI, DPPI and
RIPI preferred shares will now be shareholders in a company that employs
the best corporate governance practices (100% tag along, transparency and
simplified management structure);
o The exchange ratios were established based on a discounted cash flow
valuation.
Merger of Shares Exchange Ratio /UGPA
Companies
CBPI 0.41846
DPPI 0.64048
RIPI 0.79850
Ultrapar's capital structure will be as follows
ULTRAPAR (Ownership Structure)
Before After
Common Shares 49.4 49.4
Preferred Shares 31.9 84.7
Total 81.3 134.1
% TK Common 61% 37%
% TK Preferred 39% 63%
Deutsche Bank was hired to prepare the valuation report related to the merger of
shares
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Stage 5 - Asset sale and transfer
Petrochemical assets to Petrobras and Braskem;
Petrobras/Braskem
100%
IQ
86.9% Com.
IPQ
29,46% Com.
Braskem Copesul Petrobras
Transfer of distribution operations in the North, Northeast and Midwest regions;
Petrobras
100%
Distribution in the North, Northeast and Midwest
Ultrapar
100% 100%
DPPI Distribution in the Southeast and South
Petrobras/Ultrapar/Braskem
100%
RIPI in operation
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Total value of the transaction
o Total value of the transaction was approximately US$ 4 billion, divided as
follows:
o Petrobras: US$ 1.3 bilion;
o Braskem: US$ 1.1 billion;
o Ultrapar: issue of 52.8 million shares
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Strategy - Petrobras
o Petrochemicals:
o Selective expansion in the Brazilian and Southern Cone petrochemical
markets;
o Effective participation in the consolidation and restructuring of
Brazil's petrochemical industry;
o Expansion and appreciation of Petrobras' assets in Rio Grande do Sul;
o Selective investments in projects that add value to oil, natural gas
and refinery products.
o Distribution:
o Leading the Brazilian petroleum by-product and biofuel market, with
profitability;
o Strengthening of market position in the North, Northeast and Midwest
with the resellers and large customers - industrial, aviation,
transportation and energy generation - guaranteeing the sale of
PETROBRAS refinery products;
o Selective expansion of the gas station network, adding value to
Petrobras' system image;
o Generation of synergies between assets - basis and terminals -
increasing gas station network value - 6,200 active resellers -
distributed all over the country in addition to its 12,000 large
consumer portfolio.
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Benefits - Ultrapar
o Qualified growth of its operations;
o Substantial expansion in fuel distribution area
o Global-scale company;
o Strengthening for future expansions;
o Combination of efficiencies, logistics and resale management know-how.
o Ultrapar will have two major distribution brands for oil by-products
distribution;
o Accelerate investments in Ipiranga's operation:
o Potential growth in the Brazilian consumption;
o Potential growth in the biofuel market.
o 2006 pro-forma figures:
o Net revenue of approximately R$ 23.7 billion;
o EBITDA of R$ 861 million;
o Continuity of the quality in the Company's capital structure;
o Substantial improvement in the liquidity of the Company's shares, with
prospects of joining the IBOVESPA index.
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Benefits - Braskem
o Consolidation as the largest petrochemical producer in Latin America, with
an annual production capacity of 10 million tonnes, and one of the 10
largest in the world in terms of EBITDA;
o Leadership in all thermoplastic resins - PP, PE and PVC - with a market
share of more than 50%;
o Integration of the Southern Petrochemical Complex, with great potential for
synergy capture and new investments;
o Improved quality and productivity via higher EBITDA and EBITDA margins
through the strong integration of the production chain;
o Continuity of the quality in the capital structure;
2006 pro-forma figures:
o Gross revenue of US$ 10 billion;
o Net revenue of US$ 7.7 billion;
o EBITDA of US$ 1.4 billion;
o Net Debt/EBITDA ratio of 2.9x
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Commitment to Growth
Brazil investing in Brazil.
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estarter
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Other than the information contained in this document, Ultrapar Participacoes S.A. has not filed with the SEC any information relating to the merger of the acquisition of the Ipiranga Group, including with respect to the tender and exchange offer transactions referred to above (the "transactions"). As they become available, Ultrapar Participacoes S.A. will be filing with the SEC additional documents relating to the transactions. WE URGE INVESTORS TO READ THE DEFINITIVE OFFERING DOCUMENTS AND ANY OTHER RELEVANT DOCUMENTS TO BE FILED WITH THE SEC, BECAUSE THEY CONTAIN IMPORTANT INFORMATION. Investors will be able to obtain copies of the offering document and other documents from the SEC's Public Reference Room at 450 Fifth Street N.W., Washington D.C., 20549. Please call the SEC at 1-800-SEC-0330 for further information on the Public Reference Room. The documents may also be obtained from the website maintained by the SEC at http://www.sec.gov, which contains reports and other information regarding registrants that file electronically with the SEC. In addition, documents (including any exhibits) filed with the SEC by Ultrapar Participacoes S.A. will be available free of charge from the Investor Relations office of Ultrapar Participacoes S.A., located at Avenida Brigadeiro Luis Antonio, 1343, 9º Andar São Paulo, SP, Brazil 01317-910 011-55-11-3177-6695. PLEASE, READ THE DEFINITIVE OFFERING DOCUMENTS CAREFULLY BEFORE MAKING A DECISION REGARDING THE MERGER. This communication shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. |