Petrobras headquarters in Rio de Janeiro. The company's proposed $25-billion share sale will help it finance a $220-billion five-year spending plan through 2014, the world’s largest oil industry investment programme. Image Credit: Bloomberg News

Rio de Janeiro: Petroleo Brasileiro named six banks to manage its $25-billion (Dh91.8 billion) share sale, signalling slumping stock markets and Europe's debt crisis haven't derailed the biggest offering in the Western Hemisphere in at least a decade.

Petrobras, as Brazil's state-controlled oil producer is known, picked Banco Bradesco, Citigroup, Itau Unibanco Holding, Bank of America's Merrill Lynch unit, Morgan Stanley and Banco Santander as global coordinators of the share sale, the company said yesterday in an e-mailed statement. Petrobras wants to raise the cash from minority shareholders to develop fields such as the offshore Tupi block, the biggest crude discovery in the Americas since 1976.

"People are nervous but the world is not coming to an end," said Tan Teng Boo, chief executive officer of Capital Dynamics Asset Management in Kuala Lumpur. "Even though there have been one or two issues that have not gone ahead, markets are still generally holding up pretty well. For issuances, it's all about pricing and valuations."

Chief executive officer Jose Sergio Gabrielli said last month the fundraising may be delayed should global equity markets worsen. The slump in share prices this year has already forced companies from Hong Kong's Swire Properties to Strikeforce Mining and Resources, Russian billionaire Oleg Deripaska's molybdenum producer, to shelve their IPOs and prompted Brazilian billionaire Eike Batista to slash the size of OSX Brasil's share offering.

Shares gain

Rio de Janeiro-based Petrobras gained 1.6 per cent to 29.10 reais in Sao Paulo trading on Wednesday. The shares have retreated 21 per cent this year, while the benchmark Bovespa Index has lost 8.2 per cent on concern worsening deficit problems in the euro zone will slow global economic growth.

The share sale will help Petrobras finance a $220 billion, five-year spending plan through 2014, the world's largest oil- industry investment programme.

The company had initially planned to sell shares in the first half and pushed back the timeline as it waits for Congress to approve a bill allowing the government to sell Petrobras's deepwater reserves in exchange for new stock. The legislation is part of a package of bills introduced last year by President Luiz Inacio Lula da Silva, who sought to boost state control over the oil industry.

The government is seeking to move up a Senate vote on legislation to swap oil rights for shares in Petrobras to June 8, making it the first of four oil bills to be decided on, senator Delcidio Amaral, who is in charge of drafting the final version of the bill, said yesterday.

That will help avoid the risk that the measure, second in line for a Senate vote now, will be delayed if the first bill gets bogged down by debates, he said.

Petrobras will proceed with its share sale even without congressional approval, Gabrielli had said in an April 30 interview.