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Report: Brookfield Asset Management Unit Mulling Sale of Greenergy Biofuel Business

By Eric Volkman - May 28, 2021 at 4:41PM

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The process is apparently at an early stage; no potential price has been mentioned.

A notable low-emission fuel asset might be on the market. On Friday, Bloomberg reported that "people familiar with the matter" claim that Brookfield Business Partners (BBU 0.00%) -- a separately listed unit of Brookfield Asset Management (BAM 0.78%) -- is considering a sale of its Greenergy biofuel provider headquartered in the U.K.

The article's sources say Brookfield Business Partners is working with Citigroup and HSBC Holdings to ascertain interest from potential buyers. This project is at an early stage, and there is no guarantee of a sale, or even an offer. No potential price for Greenergy was mentioned.

Closeup of British banknotes.

Image source: Getty Images.

Greenergy is a veteran in its segment, having commenced operations in 1992 as a supplier of low-emission diesel fuel. In this respect, it was quite ahead of its time, planting its stake well before the greening of the transportation sector and other corners of the global economy took significant hold. Brookfield Business Partners gained a majority stake in the company in 2017.

Greenergy sources its fuel around the world, and supplies its wares to numerous clients in the U.K., Ireland, Canada, and Brazil.

According to its most recent annual report, in 2019 the company earned just over 15.9 billion British pounds ($22.5 billion) in revenue, which was 5% down on a year-over-year basis. On the bottom line, the company flipped to a net profit of $61 million, from the 2018 loss of nearly $34.7 million.

It is not clear why Brookfield Business Partners apparently wants to sell Greenergy. Spokespeople for both companies refused to comment on the report.

The fortunes of the two Brookfields diverged on Friday. Brookfield Asset Management shares ticked up by 0.3%, beating the generally flat performance of the S&P 500 index, while Brookfield Business Partners slumped by 0.2%.

 

HSBC Holdings is an advertising partner of The Ascent, a Motley Fool company. Citigroup is an advertising partner of The Ascent, a Motley Fool company. Eric Volkman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Brookfield Asset Management. The Motley Fool recommends Brookfield Asset Management Inc. CL.A LV and HSBC Holdings. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Brookfield Business Partners L.P. Stock Quote
Brookfield Business Partners L.P.
BBU
$24.34 (0.00%) $0.00
Citigroup Inc. Stock Quote
Citigroup Inc.
C
$51.47 (-0.37%) $0.19
HSBC Holdings plc Stock Quote
HSBC Holdings plc
HSBC
$32.94 (0.40%) $0.13
Brookfield Asset Management Inc. Stock Quote
Brookfield Asset Management Inc.
BAM
$50.24 (0.78%) $0.39

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