April 1, 2016 / 1:42 PM / in 2 years

Brazil's J&F financed Alpargatas deal with government bank loan -paper

BRASILIA, April 1 (Reuters) - J&F Investimentos SA, which manages investments for Brazil’s billionaire Batista family, financed the purchase of a controlling stake in Alpargatas SA with a loan from state-owned bank Caixa Economica Federal, the newspaper Valor Economico reported on Friday.

The seven-year loan from Caixa included a two-year grace period, Valor said, citing an unnamed source close to the operation. Representatives of Caixa and J&F were not immediately available to comment.

Under terms of the deal, J&F agreed to pay a premium of about 32 percent for Camargo Correa SA’s 44.1 percent stake in Alpargatas, the maker of Havaianas flip flops.

Brazil’s fifth-wealthiest family, led by brothers Joesley and Wesley Batista, has parlayed what began as a domestic beef business into a world-spanning food company, together with industrial, media and banking interests in recent years. Their fortune has been valued at close to $5 billion.

Their relationship with state-run banks has been under scrutiny by local authorities. Brazil’s federal accounts court, the TCU, last year said it had identified irregularities on loans to JBS SA, the world’s largest beef producer, and was deepening an investigation into the company’s relationship with state-run lender BNDES.

Reporting by Silvio Cascione; Editing by Bernadette Baum

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