At least 17 looking to manage sale of water utilities

- Wednesday, January 19, 2011

At least 17 looking to manage sale of water utilities

The Chilean government has received offers from 17 financial services companies to manage the sale of its stakes in four water utilities, local paper El Mercurio reported.

The interested companies include LarrainVial, Celfin Capital, Banchile Inversiones and IM Trust.

The government is expected to make a decision by month-end. It is likely that more than one firm will be chosen, and factors such as experience in the sanitation sector, international distribution capacity and added value will be considered, according to the daily.

Start your 15 day free trial now!

cta-arrow

Already a subscriber? Please, login

State development agency Corfo holds 45.4% of utility Essal, 43.4% of Essbio, 34.9% of Aguas Andinas, and 29.3% of Esval. The assets have provided the agency with income of US$150mn/y.

The government expects to collect US$1.6bn from the sale, and has said it may use 25% of the proceeds from the sale to fund the expansion of capital Santiago's metro system. The government is currently a majority shareholder in the system's operator, Metro.

The government could allocate another 25% to funding entrepreneurship programs, and at least 50% to additional Corfo investments, the report said.

The government had originally said that the sale of its share in the utilities would be used to fund efforts to rebuild infrastructure that was damaged by the earthquake that devastated central-southern parts of the country in February 2010.