CG Carlyle Group Inc

SÃ O PAULO—Troubled Brazilian investment bank BTG Pactual SA on Wednesday said it sold its remaining 12% stake in the local hospital operator Rede D'Or Sã o Luiz for 2.38 billion reais ($616 million) to Singapore's sovereign-wealth fund GIC Pte. Ltd.

BTG and Rede D'Or's controlling shareholder—the Moll family—sold a 16% stake in the hospital group to GIC in May.

The move comes as BTG is trying to raise cash following last Wednesday's arrest of André Esteves, its controlling shareholder, as part of Brazil's largest-ever corruption investigation. Mr. Esteves remains jailed in Rio de Janeiro.

BTG has been hit with a wave of investor withdrawals following the arrest of Mr. Esteves in connection with the probe centered on state-run oil giant Petró leo Brasileiro SA, or Petrobras. Prosecutors allege Mr. Esteves attempted to bribe a key witness to keep him from providing testimony that could implicate the banker in the scandal.

Mr. Esteves has previously denied wrongdoing. He resigned as the bank's chairman and chief executive on Sunday.

BTG's unit shares have plunged more than 30% in recent days, and the bank lost its investment grade status from Moody's Investors Service. The ratings agency downgraded BTG's rating by two notches to Ba2 from Baa3 late Tuesday and kept it under review for potential further downgrade.

Rede D'Or operates close to 30 hospitals in four Brazilian states. Earlier this year, Brazil´ s government ended the ban on foreign ownership in the hospital sector, attracting the interest of several international groups.

Rede D' Or is controlled by the Moll family, which continues to be Rede Do'r largest shareholder. In April, private-equity firm Carlyle Group LP said it was investing 1.75 billion Brazilian reais for an 8.3% stake in Rede D'Or.

Write to Rogerio Jelmayer at rogerio.jelmayer@wsj.com and Luciana Magalhaes at Luciana.Magalhaes@dowjones.com

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(END) Dow Jones Newswires

December 02, 2015 08:05 ET (13:05 GMT)

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