Brazil's Neoenergia, Elektro in merger talks

Tuesday, April 18, 2017

Brazil's Neoenergia and Elektro are reportedly in merger talks as Spanish group Iberdrola, which holds stakes in both companies, seeks to consolidate its local assets.

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The proposal has received the backing of Iberdrola's fellow Neoenergia stakeholders Banco do Brasil (BB) and Previ, according to a report in the Estado de S.Paulo newspaper on Tuesday.

The deal would facilitate plans for BB and Previ – the former's pension fund – to later sell their stakes in Neoenergia, the report said, citing an unnamed source with knowledge of the matter.

Neoenergia has interests in three electricity distributors in addition to a 50% share of the 1.82GW Teles Pires hydroelectric plant and 10% of the 12.1GW Belo Monte project.

Elektro is a power distribution concessionaire in the states of São Paulo and Mato Grosso do Sul. The company reported 2016 net revenue of 4.7bn reais (around US$1.5bn).

See Neoenergia's top Brazilian projects here