The world belongs to the smart ones! The real reasons that led PRIO to buy Dommo, Eike Batista's former company

Oil company Prio released a statement alerting the general public that the deal to buy Dommo Energia had been finalized.

In the last week, oil company PRIO: , formerly PetroRio, issued a statement alerting the general public that the deal to buy the entirety of the Dommo Energia, which was once known as OGX and was led by Eike Batista, had been completed. In the material fact, it was said that Dommo shareholders will have the option to exchange their shares for cash or for PRIO shares according to an exchange ratio of 1 PRIO3 share for every 20 Dommo Energia shares. 

The news did not catch investors by surprise, as they already expected the deal to happen sooner or later. Proof of this is that Dommo Energia's shares appreciated by more than 200% in 2022 alone. Prisma Capital specializes in taking over problematic assets such as the former OGX de Eike Batista, and had taken control of the company earlier in the year.

PRIO will have several benefits with the acquisition of Domo

"Although we believe that the actions already reflect in part the operation, since its execution has been discussed by the market for some time, we consider this step positive for Petrorio", said a report by Ativa Investimentos, about the deal.

Prio will benefit from the deal, as it will have full ownership of all aspects of the cluster's activities. Hammer shark and Octopus. In addition, analysts said that the corporation could acquire up to R$ 7 billion in tax gains with Dommo, as a result of more than R$ 20 billion in accumulated losses over time, when it was still OGX, and this would also be one of the reasons for closing the deal.

It is estimated that PRIO will have a net real value of between R$2,5 billion and R$4 billion in tax benefits with the acquisition of Dommo

According to analysts at BTG Pactual, who characterized the operation as “small”, the net present value of the tax benefits that the company could obtain is estimated at between R$ 2,5 billion and R$ 4 billion, only. However, to give you an idea, this represents something between 11% and 18% of Prio's market value, currently.

About PRIO and Dommo Energia

PRIO is a publicly traded Brazilian company specializing in effective reservoir management and mature field development. Its main business activities include the production of oil and gas, as well as the investment and recovery of production assets.

Dommo Energia SA is a company whose main focus is on the oil industry. Formerly known as OGX, it also operates in the energy sector. Between 2012 and 2015, the business successfully recovered around 6,5 million barrels of oil from the Tubarão Azul field, located in the Campos Basin. Oil extraction began in the Tubarão Martelo area, also in the Campo Basin, in 2013 and continues to this day.