Shell Gas BV, Shell Brazil Holding BV and Integral Investments BV on Tuesday said they’ve signed a deal with Cosan Ltd. to execute an existing put option agreement, allowing Shell to sell its 16.8% interest in Companhia de Gas de São Paulo (Comgás).
Under the agreement, Shell will exchange its roughly 21.8 million common shares in Comgás for Cosan S.A. Indústria e Comércio (Cosan SA) shares plus cash, with the total value of the deal pegged at $380 million.
Comgás is Brazil's largest natural gas distributor, with more than 14,000 kilometers (8,700 miles) of pipeline and over 1.7 million customers in 87 municipalities. Cosan currently owns 63.4% of Comgás, Kallanish Energy reports.
"This transaction allows us to focus our efforts in Brazil on areas where we see the most strategic value for Shell longer-term," said Shell's Integrated Gas and New Energies director, Maarten Wetselaar.
Shell retains diverse operations in Brazil unaffected by this transaction, including its Deep Water offshore portfolio and downstream business, which includes participation in Raízen, one of the leading biofuel producers in Brazil.