Votorantim Energia, CPPIB JV to take control of large Brazilian hydro firm

Author: U.S. Army Corps of Engine. License: Creative Commons, Attribution 2.0 Generic.

October 22 (Renewables Now) - Votorantim Energia and the Canada Pension Plan Investment Board (CPPIB) is acquiring a majority stake in Brazilian hydropower plants (HPPs) operator Companhia Energetica de Sao Paulo (BVMF:CESP6), or CESP.

A consortium created by a joint venture of the two companies bought 80.2% of CESP’s common shares and 13.7% of its class B preferred shares in an auction held by the state of Sao Paulo at the Brazilian Stock Exchange on Friday. The group offered USD 14.60 per common and class B preferred share for a 35.6% interest, which equals an investment of BRL 1.7 billion (USD 457.7m/EUR 398.3m).

The JV partners will kick off a mandatory tender offer for the remaining common and class B preferred shares of CESP after they assume control of the hydropower producer.

The transaction, which is subject to regulatory clearance, will result in CESP getting a new 30-year concession for the 1,540-MW Porto Primavera HPP in exchange for a BRL-1.4-billion payment, the announcement says.

(BRL 1.0 = USD 0.269/EUR 0.234)

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Ivan is the mergers and acquisitions expert in Renewables Now with a passion for big deals and ambitious capacity plans.

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