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HONG KONG/SAO PAULO, Sept 4 (Reuters) - China Merchants Port Holdings Co Ltd agreed to buy 90 percent of TCP Participações SA, Brazil's most profitable port terminal, for about 2.9 billion reais ($924 million), a sign of growing interest in assets across Latin America's No. 1 economy.
China Merchants said in a statement on Monday that it bought the stake from an investment vehicle led by Advent International Corp and other partners including Soifer, Pattac Empreendimentos SA and Grup Maritim TCB SL. The remaining 10 percent stake in TCP will be held by Soifer, Pattac and another partner.
Based in the City of Curitiba, TCP operates the container terminal concession in Paranaguá, Brazil's No. 2 container terminal. The deal is conditional on antitrust and regulatory approval, the statement said.
According to two people with knowledge of the deal, China Merchants's bid valued TCP at 14.3 times annual earnings before interest, tax, depreciation and amortization, topping estimates of a multiple around 13 times EBITDA that Reuters reported on April 19.
Foreign players perceive Brazilian port operators as less prone to facing roadblocks than other infrastructure segments. A record grain crop and a recovering economy may accelerate port and terminal merger and acquisition activity before valuations climb further, the people said.
Returns in Brazil's port industry have declined in recent years, after shipping companies gained in scale through M&A and a supply glut and heightening competition hurt container players, especially in the Santos port, Latin America's largest.
Still, investor interest in the segment has grown as a three-year recession shows signs of subsiding.
In April, Reuters reported that Porto Itapoá and liquid bulk terminal AGEO Terminais e Armazéns Gerais SA were among potential takeover targets, according to people familiar with the situation. Brazil's D'Avila family is also considering selling Terminal Portuario de Itajai SA, or Teporti, one person said.
China Merchants plans to fund the TCP acquisition with cash and debt, the statement said.
Advent and partners in TCP negotiated for over a year with other global port players, including Dubai Ports World Co, people told Reuters at the time.
(1 real = $0.3188) (Reporting by Donny Kwok in Hong Kong and Guillermo Parra-Bernal in Sao Paulo; Editing by Stephen Coates)