UPDATE 1-Brazil's CAOA offers to buy Banco BVA 2014 bonds at discount

Thu Mar 21, 2013 3:40pm EDT

* CAOA offers 35 cents on the dollar plus interest for bonds

* Banco BVA was seized by central bank after breaching rules

By Guillermo Parra-Bernal

SAO PAULO, March 21 (Reuters) - Brazilian entrepreneur Carlos Alberto Oliveira Andrade is offering to purchase Banco BVA SA's 2014 bonds from investors at a 65 percent discount as part of plans to take over the bankrupt Brazilian small-sized lender, two sources with knowledge of the situation said on Thursday.

Oliveira Andrade, who through his car dealership and financing group CAOA is extending the tender for the bonds, formalized a proposal to buy Banco BVA last week. Banco BVA was seized by the central bank last October, citing deteriorating financing conditions and a breach of regulations.

CAOA is offering to pay bondholders of the notes 35 cents on the dollar plus accrued interest in cash, the sources said. The tender, which is being managed by Deutsche Bank AG and Brasil Plural Banco Multiplo SA, hinges on a successful acquisition of Banco BVA, the sources added.

The tender expires on March 27.

In the takeover proposal made to regulators and Banco BVA's creditors last week, Oliveira Andrade wants to convert all debts into shares of BVA. Currently there are $45 million outstanding of the 2014 securities.

CAOA's press office did not immediately respond to written requests seeking comment on the plan. Calls to a spokesman for CAOA in São Paulo were not immediately answered.

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