Colombia's EEB may seek to buy back shares from Ecopetrol

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Thursday, October 23, 2014

Colombian power holding EEB may be interested in buying back its own shares from state oil firm Ecopetrol, a Bancolombia analyst report said Thursday, citing leaked reports.

Last month Ecopetrol revealed plans to liquidate its 6.87% stake in EEB, which was followed by a drop in EEB's value on the Colombian stock exchange. The state oil firm has previously stated it expects to sell the shares in the first half of next year. The stake is currently valued at around US$500mn, according to Bancolombia.

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If EEB's buyback intentions are confirmed, the news will have a positive effect on its equity price and would have positive implications for the stock value of Colombia state transmission firm ISA, analysts said.

"If (and it's still a big if) EEB were to buy this stake then it might also prove positive for ISA given that Ecopetrol have also announced their intention to sell their 5.32% stake (US$250mn) as there would be a reduced competition for buyers," the report said.

BNamericas will host its 11th Southern Cone Energy Summit in Lima, Peru, on November 12-13. Click here to download the agenda.