Brazil's Neoenergia, Elektro in merger talks

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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