Oct 5, 2012 - Brazilian renewables company CPFL Renovaveis yesterday announced it had filed a request with local stock exchange regulator CVM to cancel its planned initial public offering (IPO).
The move mirrors the uncertainties provoked by the recently announced renewal for up to 30 years of local energy concessions before their expiry in 2015 coupled with the global economic crisis, the company's CEO, Miguel Normando Abdalla Saad, explained.
The government decision to extend the concessions at lower contract prices has resulted in market fear and sharp fall of local utilities' stock.
CPFL Renovaveis, however, does not rule out the possibility of resuming its IPO plans in the future and affirms it will keep the market updated on the issue.
The company had initially planned the IPO for the end of June 2012. However, unfavourable market conditions had made it push back the launch to October or November.
In September, local daily Valor Economico reported that CPFL Renovaveis was poised to shelve the offering, expected to raise about USD 800 million (EUR 615m) for the company's expansion.
CPFL Renovaveis was created last year via the merger of the renewable assets of Brazil's power firm CPFL Energia (SAO:CPFE3) and green energy investment player ERSA. It has 1,133 MW capacity in operation, composed by small-scale hydroelectric power plants (HPPs), wind parks and biomass energy facilities.