Brazil: Ipiranga acquires distributor with 2,000 gas stations

Brazil's second biggest fuel distributor, Ipiranga, has agreed to acquire a smaller competitor for 2.17 billion reais ($635 million), challenging the position of state oil company Petrobras.

Ipiranga, a unit of Ultrapar Participações SA with a network of 7,241 gas stations, is targeting the northeast of Brazil through the acquisition of Alesat Combustíveis SA (ALE), the country´s fourth largest distributor with a network of around 2,000 fuel stations, reports Reuters.

With this acquisition Ipiranga overtakes Petrobras Distribuidora as the leading retailer in the market, comfortably surpassing the state company´s 7,500 gas stations.

ALE´s net debt, equal to 737 million reais ($215m) in December, will be deducted from Ipiranga´s cash payment for the operation.