Arco Will Sell Marketing Unit to Brazilian Oil Firm

Atlantic Richfield Co.’s Arco Products subsidiary announced Thursday that it has agreed to sell its $1.8-billion-a-year Brazilian marketing unit to Companhia Brasileira de Petroleo Ipiranga, Brazil’s second-largest oil company.

Terms were not disclosed, but a Brazilian newspaper pegged the price at about $300 million.

The Brazilian operation, in business more than 60 years, is Arco’s only wholly owned overseas marketing operation. Arco said it simply did not fit the company’s strategy, which concentrates on refining and marketing gasoline on the U.S. West Coast.

“Geographically, it doesn’t fit in,” said William C. Rusnack, the recently appointed president of Arco Products. “Our markets are concentrated on the West Coast, and if anything (overseas) made sense it would be in the Pacific Rim area, not the East Coast of South America.” He added that Arco had agreed to sell the unit back in 1987, but the deal fell through.

The subsidiary runs about 2,600 service stations in Brazil.