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The Painter and the Model was taken in a daylight robbery in June from the state-owned Estacao Pinacoteca museum.

Police said an arrested suspect had led them to the engraving, wrapped in a plastic bag and hidden in an attic, apparently in perfect condition.

Another Picasso and two paintings by Brazilian artists stolen in the same robbery have not yet been recovered.

The man arrested was held on suspicion of trying to steal a cash machine, but instead led police to the stole Picasso.

"We were taken by surprise," Inspector Cesar Carlos Dias told the Associated Press.

"We were keeping an eye on [the suspect] and two other men because we had information they were planning to steal automatic teller machines and rob banks.

"In a tapped phone conversation, the Picasso print was mentioned."

The man, a 30-year-old Sao Paulo resident, was arrested on charges of robbery, police said.

The two Picasso engravings and the other works stolen in June have a combined estimated value of 1 million Brazilian reals (US$630,000), museum officials have said.

Sao Paulo has a history of art thefts: a painting by Picasso was among two works stolen from the city's Museum of Art that were recovered in January.

(BBC)

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