Braskem S.A. ADR (BAK)

Braskem S.A. ADR (BAK) stock plummeted by 14.17% following Abu Dhabi National Oil Co.'s withdrawal from its bid for a stake in the troubled Brazilian petrochemicals company. This move indicates a prolonged stop-and-start sales process.

• Abu Dhabi National Oil Co.'s Decision: Abu Dhabi National Oil Co. decided not to proceed with its $2.1 billion offer, disappointing equity investors who anticipated a deal. Braskem's shares dropped as much as 16% in New York upon hearing the news, heading towards their lowest close since February.
• Braskem's Struggle for Stability: Braskem's financially strained controlling shareholder, Novonor SA, has been attempting to sell its stake for years. Brazil's state-controlled oil company, Petrobras, Braskem's second-biggest shareholder, desires a new investor to replace Novonor.
• Uncertainties Surrounding the Sales Process: Demand for Braskem's products is expected to rise, particularly in plastics, paints, and car parts, amidst the growing consumption in the region. However, Novonor has faced challenges in finding a buyer for its stake.
• Ongoing Developments and Challenges: In March, Braskem revealed the entry of a new bidder for Novonor's stake. Adnoc's interest in Braskem was part of its strategy to expand into global chemicals business. However, the company faces hurdles in its proposed acquisitions and merger plans, including valuation disputes and potential delays due to elections.

Shares of Braskem S.A. ADR (BAK) dropped by 4.24% from $7.78 to $7.45 in the trading on Friday, December 1, 2023. The reason why BAK is down today is due to a new 1 billion real ($203 million) lawsuit filed against the company by state and federal prosecutors. The lawsuit relates to damages caused by Braskem's salt mines, leading to ground subsidence in Maceio, Brazil, and the need for compensation to more affected families. The sinking ground problems are linked to Braskem's rock salt mining activities, and while the company has set aside significant funds to address these issues, it's uncertain if the lawsuit's demands are already covered. Braskem aims to complete the relocation and compensation process for affected residents by early 2024. The lawsuit's uncertainties likely contributed to the stock's decline.

Braskem SA ADR Stock (BAK) dropped by 5.57% from $7.00 to $6.61 in the trading on Monday October 30, 2023. The reason why BAK stock down today is due to the disappointing production and sales report. Braskem's operational performance in 3Q23 continued to be impacted by the adequacy of production in the face of lower global demand, which remained at historically low levels due to the industrial slowdown in the main economies such as the United States, the Euro Zone, and China. Additionally, operational instabilities caused by external factors reduced the production volume of the Brazil and Mexico segments.

Shares in Braskem extended losses after the news that Brazilian state-run oil company Petrobras said it made no decision on a potential increase in its stake in petrochemical firm Braskem. The firm said in a securities filing its board and management made no decision regarding "the process of disinvestment or stake increase in Braskem.

https://finance.yahoo.com/news/1-brazils-petrobras-mulls-acquiring-153229054.html