São Paulo governor announces Sabesp capitalization plan in New York

Wednesday, May 17, 2017

São Paulo governor Geraldo Alckmin announced a capitalization plan for state water utility Sabesp during a visit to New York on Tuesday, according to a state government release.

The state is planning to create a holding company - with private sector participation - for the water and sanitation industry which would exercise direct shareholder control over Sabesp, the governor said during an event to celebrate the utility's 15-year anniversary on the New York Stock Exchange (pictured).

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The capitalization plan, which was approved by the state's privatization program PED on May 12, could bring together key Sabesp subsidiaries in the areas of waterworks, solid waste management, among others, the release said.

"With the creation of the holding company, we will be able to attract more private capital and accomplish more work, all while counting on the expertise of the private sector," said Alckmin.

The state of São Paulo will continue to hold enough shares to assure control of the company, the release said.

São Paulo governor Geraldo Alckmin (CREDIT: AFP).

The governor made the announcement during his New York roadshow from May 15-17, focused on presenting infrastructure concession projects to potential investors.

Sabesp is the largest water utility in Latin America and one of the largest in the world. It serves 27.7mn customers residing in 367 of São Paulo's 645 cities and towns. The company's 2017-21 investment target is 13.9bn reais.