| SAO PAULO, Sept 7
SAO PAULO, Sept 7 Brasil Pharma SA is
close to selling two units for about 1.2 billion reais ($375
million) as the nation's No. 3 drugstore chain shrinks further
to cut debt, two people with direct knowledge of the
BR Pharma will first sell Drogaria Rosário Distrital to
wholesale pharmacy firm Profarma Distribuidora de Produtos
Farmacêuticos SA, according to the sources. The sale,
which could fetch about 200 million reais, is expected to be
closed in the coming days, they added.
BR Pharma will then dispose of Drogarias Big Ben for 1
billion reais, said the sources, who asked not to be identified
as the deal is still in the works. The buyer will be industrial
and services group Ultrapar Participações SA's
drugstore chain arm, the people said, without giving a timetable
for an announcement.
São Paulo-based BR Pharma, which is backed by the buyout arm
of investment bank Grupo BTG Pactual SA, did not
have an initial comment, just as Ultrapar and Rio de
Created as a vehicle to consolidate the purchases of the
Mais Econômica, Rosário, Farmais, Sant'Anna and Big Ben chains,
BR Pharma has grappled with integration problems, shareholder
disputes, high debt and rising competition.
The process of dismantling BR Pharma gained traction last
November, when BTG Pactual was hit with massive client fund
withdrawals in the wake of a scandal, leaving the bank short of
funds to pour into the drugstore chain operator.
BTG Pactual, Latin America's largest independent investment
bank, engineered the sale of money-losing chain Mais Econômica
to a group of local investors for $12 million a few months ago.
Shares in BR Pharma, which sank an average 70 percent
between 2013 and 2015, have doubled this year on speculation
over the planned asset sales. In the past three months days, the
stock rose 158 percent.
Big Ben, which contributes about 40 percent to annual
revenue at BR Pharma, has some 150 stores in Brazil's northern
and northeastern regions, while Rosário has about 130 stores
located across Brazil's midwestern region.
($1 = 3.1960 Brazilian reais)
(Editing by Guillermo Parra-Bernal and Jeffrey Benkoe)