THE BRAZILIAN transport ministry announced on May 6 that it had completed a recapitalisation of Brasil Ferrovias, which controlled the Ferronorte, Ferroban and Novoeste concessions.

Earlier this year federal investment bank BNDES agreed to take a 31% stake in Ferronorte (RG 4.05 p181). The completed package provides an injection of R$1·5bn into Brasil Ferrovias, with R$647m coming from BNDES, R$446m from a debt-for-equity swap and R$375m from shareholders.

The money is intended to fund investment in the soya export corridor linking Mato Grosso do Sul and São Paulo states, which is operated by Ferronorte and Ferroban. Over the next two years Brasil Ferrovias expects to invest R$2·4bn, including R$306m on track maintenance, R$210m on rolling stock refurbishment and R$446m on new locos.

To restrict the federal involvement to the southern corridor, the rail concessions are being split. Novoeste has been transferred to a new holding company, Novoeste Brasil. This is controlled by the existing shareholders, including the pension funds Previ and Funcef (below). The split increases the BNDES stake in Brasil Ferrovias to 49%.

Ferroban and Novoeste will be required to sign new agreements with transport regulator ANTT setting revised targets for investment, operations and safety.

Novoeste Brasil shareholders

Previ 20·8%

Funcef 20·8%

Constran 18·6%

LAIF 17·7%

BRB 6·5%

JP Morgan 5·5%

Bradesco 4·1%