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Acquisition of share in local gas distribution company in Ceara state, Brazil

Dec. 18, 2014


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Mitsui & Co., Ltd. ("Mitsui", Head Office: Tokyo, President & CEO: Masami Iijima) has signed a Share Purchase Agreement with Taquari Participacoes S/A, to acquire a share in Companhia de Gas do Ceara S.A. ("Cegas"), a local gas distribution company ("LDC") in the state of Ceara, in the northeastern part of Brazil, on 17th of December, 2014.

In 2006, Mitsui acquired Mitsui Gas e Energia do Brasil Ltda ("MGEB"), which has LDCs in 7 states of Brazil and is undertaking the development and maintenance of infrastructure for gas distribution and stable distribution of gas for 8 years. Mitsui acquires share in Cegas (common share 24.5%, preferred share 50%, economic investment ratio 41.5%) through MGEB. Consequently, the gas distribution volume of LDCs under MGEB will be 14.69 million m3 per day, which is equivalent to 22% of the total distribution volume in Brazil.

Under the concession agreement which has been executed between Cegas and the state government, Cegas undertakes the development and maintenance of infrastructure for gas distribution, and distributes gas, which is purchased from Brazilian public petroleum company Petrobras, to the thermal power plant, industrial customers, fuel for natural gas vehicles, etc. in the state of Ceara.

The Ceara state capital, Fortaleza, which is the fifth biggest city in Brazil with a population of 2.5 million, has geographical advantage as an industrial park, and the northeast railway is being expanded to the port of Pecem. Ceara offers convenient access to the US, Europe, and Africa. Cegas distributes gas of 1.96 million m3 per day, mainly to the thermal power plant and industrial customers, and an increase in gas demand accompanying the economic development is expected.

Mitsui utilizes knowledge and know-how accumulated through the operation of MGEB, with business partners, the state of Ceara and Petrobras, to contribute to the gas distribution business in the state of Ceara and to expand its energy business in Brazil.

Profile of Cegas

Name of the Company Companhia de Gas do Ceara S.A. (Cegas)
Head Office Fortaleza, State of Ceara, Brazil
Establishment 1992 (Start of Operation: 1994)
Shareholders (after the acquisition) Common share: MGEB 24.5%, state government 51%, Gaspetro (*) 24.5%
Preferred share: MGEB 50%, Gaspetro 50%
Business Activities Gas distribution business in the state of Ceara (Concession)
Gas Distribution Volume 1.96 million m3 per day
Concession Term 50 years (until 2043)
Holding Pipeline 350 km

*Gaspetro is a wholly owned subsidiary of Petrobras

Map of LDCs under MGEB

Map of LDCs under MGEB

Notice:
This announcement contains forward-looking statements. These forward-looking statements are based on Mitsui's current assumptions, expectations and beliefs in light of the information currently possessed by it and involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors may cause Mitsui's actual results, financial position or cash flows to be materially different from any future results, financial position or cash flows expressed or implied by these forward-looking statements. These risks, uncertainties and other factors referred to above include, but are not limited to, those contained in Mitsui's latest Annual Securities Report and Quarterly Securities Report, and Mitsui undertakes no obligation to publicly update or revise any forward-looking statements.
This announcement is published in order to publicly announce specific facts stated above, and does not constitute a solicitation of investments or any similar act inside or outside of Japan, regarding the shares, bonds or other securities issued by us.

Information

For inquiries on this matter, please contact

Mitsui & Co., Ltd.
Corporate Communications Division
Shuhei Iwanaga
Telephone: +81-3-3285-7596
Facsimile: +81-3-3285-9819