Under the terms of the agreement, Sinopec will subscribe a $4.8bn capital increase in Petrogal Brasil, and other related operational subsidiaries.
The existing Galp Energia’s Brazilian assets are valued at $12.5bn at closing.
Upon completion of the transaction, Galp Energia will retain 70% ownership while Sinopec will hold the remaining 30% interest.
In addition, Sinopec will make a shareholder loan to Petrogal Brasil for $390m, which will be used to reimburse 30% of the loans to Galp Energia of $1.3bn.
The transaction is subject to the approval of the competent authorities, reports Reuters.
