EIG – a leading institutional investor in the global energy and infrastructure sectors – recently announced that it has entered into definitive agreements with Novonor S.A. and Brazilian Development Bank (BNDES) to acquire Ocyan Participações S.A., a Brazilian-based solutions provider to the offshore oil and gas industry, for a total amount of $390 million, considering $283 million for Novonor’s 100% equity interest and the remaining amount for liquidation of its outstanding balance of non-voting securities related to the company.
The proceeds related to Novonor’s equity interest will be directly paid to BNDESPAR, under the fiduciary agreement previously executed by the parties, to settle a portion of Novonor’s debt.
Ocyan has a 23-year track record delivering high-quality maintenance solutions to the offshore oil and gas sector, including the operation of subsea construction and decommissioning projects. And as the only Brazilian operator in the Floating Production Storage and Offloading (FPSO) industry, Ocyan currently operates four offshore units through a 50/50 joint venture with Altera Infrastructure, holding long-term contracts with Libra Consortium, Karoon Energy, and 3R Petroleum. The company – with over 3,000 dedicated employees – recently established a New Energies division that is focused on the digitalization of the oil and gas industry and engineering, procurement, and construction (EPC) contracts for renewable energy projects.
EIG has invested over $2 billion in Brazil since 1998. The acquisition of Ocyan reflects EIG’s long-term and comprehensive Brazilian strategy focused on the infrastructure supporting high-quality deepwater crude oil production, responsible decommissioning activities, and investments in renewables and low-carbon projects. Following the deal’s completion, Ocyan will benefit from EIG’s deep technical expertise in FPSOs and potential synergies with Prumo Logística, an EIG portfolio company, and its subsidiary, Port of Açu.
The deal’s completion is subject to certain customary closing conditions and is expected to occur in the first quarter of 2024.
Lakeshore Partners has acted as EIG’s exclusive financial advisor, with Lakeshore’s newly established affiliate Lake Capital, providing asset management services. And Mattos Filho and White & Case served as transaction legal advisors and Stocche Forbes as fund counsel. EY has acted as BNDES’ exclusive financial advisor and Lacaz Martins as transaction legal advisor. VMB Jurídica served as transaction legal advisor to Novonor.
KEY QUOTES:
“I have known and respected Ocyan for decades. The company’s resilience and the strength of its business have helped it overcome significant economic headwinds while maintaining a healthy balance sheet, positioning Ocyan for long-term growth. Brazil is home to over 25% of the global FPSO fleets, and we believe the future market dynamics for oil and gas infrastructure in Brazil are very favorable, underscoring our dual commitment to supporting growth and development in this important region while creating value for our investors. We are also excited to support Ocyan’s ventures in the renewables space to help drive the energy transition forward.”
— R. Blair Thomas, EIG’s Chairman and Chief Executive Officer
“FPSO is an attractive asset class for both equity and debt opportunities, and we are pleased to deepen our presence in the industry. We have admired Ocyan for many years and have been impressed by their ability to develop ambitious projects through challenging economic environments. With our global footprint and local capabilities, which are now enhanced by meaningful capital commitments from local clients, we believe that EIG is uniquely positioned to deliver on this complex transaction and to usher Ocyan into a new phase of growth.”
— Flavio Valle, EIG’s Managing Director and Head of Brazil
“This is another important milestone for the Novonor Group in fulfilling its commitments to its stakeholders as it aims to reestablish the company’s focus on diversified operations in the engineering sector, where it was established almost 80 years ago. We are very proud of Ocyan and its team, who are recognized for their operational and technical excellence, and are certain that their successful trajectory will continue.”
— Héctor Nuñez, Novonor´s Chief Executive Officer
“Ocyan has built and operated more than US$4 billion of drilling rigs, pipelaying support vessels and FPSOs, alone or in joint ventures, always enjoying the very strong support of its shareholders and Novonor. This acquisition does not impact current contracts and operations with our clients and suppliers. This is another important chapter in our history and one that will undoubtedly create new opportunities for Ocyan.”
— Roberto Prisco Paraiso Ramos, Ocyan’s Chief Executive Officer
