Ecopetrol Wins Auction to Take Control of Brazil’s Brava Energia

Ecopetrol S.A. (BVC: ECOPETROL; NYSE: EC) has successfully completed the Brazilian tender offer that will allow the Colombian energy company to take control of Brava Energia S.A. (B3: BRAV3), acquiring approximately 25% of the Brazilian oil and gas producer through an August 5 auction on the B3 exchange.

Ecopetrol’s Brazilian subsidiary, Ecopetrol Investimentos do Brasil Ltda., acquired 116,110,717 common shares at R$23 per share. The shares represent approximately 25% of Brava Energia’s issued and outstanding share capital. Ecopetrol said the auction attracted strong market demand and was completed after all applicable regulatory requirements and conditions precedent for the offer were satisfied.

“We expect to disclose the results of the OPAV together with any other material developments related to the transaction.” – Ecopetrol S.A.

The auction is the second major component of Ecopetrol’s plan to obtain a 51% controlling voting stake in Brava Energia. In April, Ecopetrol agreed to acquire approximately 26% of Brava from a group of significant shareholders through a separate share purchase agreement. Combining that transaction with the shares acquired through the OPAV is expected to give Ecopetrol approximately 51% of Brava’s voting share capital.

CVM suspension cleared the way for the auction

The successful auction follows a regulatory dispute that temporarily interrupted the transaction.

Brazil’s Comissão de Valores Mobiliários (CVM) suspended the tender offer on June 16 after its technical division identified issues requiring adjustments to the offer documentation. The suspension initially threatened the planned June 25 auction.

Ecopetrol and the offer’s intermediary institution appealed the decision. On July 14, the CVM’s Collegiate Board granted the appeal, reversing the basis for the suspension and allowing the offer process to proceed following the required amendments.

Ecopetrol subsequently published a revised offer document on July 20 incorporating the regulator’s recommendations and reopened the OPAV. The revised timetable established August 5 as the auction date and August 17 as the financial settlement date.

The transaction also cleared another important condition before the auction. Brazil’s competition authority, CADE, granted the relevant merger-control approval, which became final in June. The amended offer documentation also reflected waivers obtained from Brava’s debenture holders concerning the change of control.

Ecopetrol targets a larger Brazilian oil and gas position

The Brava transaction represents a bigger expansion of Ecopetrol’s position in Brazil, where the Colombian company has operated for approximately two decades.

Brava Energia was created in 2024 through the merger of 3R Petroleum Óleo e Gás and Enauta Participações. The company operates oil and natural gas assets across multiple Brazilian basins, including both offshore and onshore operations, as well as midstream activities. At the end of 2025, Brava reported approximately 459 million barrels of oil equivalent in reserves.

Ecopetrol said the acquisition is intended to strengthen its international exploration and production portfolio and diversify its reserve and production base. The company already holds Brazilian upstream interests, including a stake in the Gato do Mato development in the Santos Basin.

Settlement will complete the control transaction

Although the auction has been successfully completed, the transaction is not yet fully settled.

Ecopetrol said the OPAV shares will be paid for and settled on August 17, 2026. On the same date, the company expects to consummate the April share purchase agreement covering the approximately 26% stake held by the existing shareholder group, subject to completion of the remaining procedures required under the transaction agreements and applicable regulations.

Ecopetrol plans to initially finance the transaction through a short-term bridge facility arranged through Ecopetrol Capital AG. The company said it expects to refinance that facility through a combination of long-term debt and equity contributions, with the objective of maintaining a capital structure consistent with its leverage targets and credit ratings.

Once both components are completed, Ecopetrol is expected to hold approximately 51% of Brava Energia’s voting share capital, giving Colombia’s state-controlled energy company control of a major independent Brazilian oil and gas producer.

The successful August 5 auction therefore marks the key operational step in Ecopetrol’s planned takeover. The remaining milestone is financial settlement on August 17, after which the company expects the combined transactions to establish its controlling position in Brava Energia.

Headline photo: Ecopetrol headquarters in Colombia (Photo shared by Ecopetrol via their website)