Brazilian energy group Companhia Energetica de Minas Gerais (Cemig) has outlined plans to divest US$2.2 billion worth of assets, including hydropower plants, as it seeks to slash its debt load.
Cemig plans divest its interests in the following: The 27-MW Cachoeirao, 20-MW Pipoca and 25-MW Paracambi small hydropower plants; Cemig Telecomunicacoes; and in power group Neoenergia, according to BNamericas.
The sale catalog also includes stakes in transmission company Taesa; hydroelectric generator, Santo Antonio; Rio de Janeiro utility, Light; Cemig; and renewable energy company, Renova Energia.
According to Cemig, for 2017, the company expects investments of US$46.2 million in renovations, reinforcement and maintenance of the electricity grid, 12% higher than the one applied by the company in 2016.
In March, HydroWorld.com reported the Brazilian Supreme Court revoked Cemig’s right to operate the 424-MW Jaguara hydropower plant. The Brazilian government said it will hold a new auction for Jaguara’s operating rights.
In April, Brazil’s Ministry of Mines and Energy announced it would auction 30-year concessions for rights, but it has yet to set a date for the auction.
The government said winning bidders will be required to pay at minimum $570 million for Jaguara.
Last week, Cemig Director Cesar Vaz de Melo said, the company hopes to complete at least half of the divestments by mid-2018.
“Cemig’s management has no doubt about carrying out the sale of these assets,” Melo said, adding that several negotiations were at an advanced stage.
Light Energia is expected to be sold to Alianca Energia, a joint venture between Cemig and miner Vale. Meanwhile, an offer for Renova could be made within days, according to company executives.
Cemig said it also plans to raise up to US$1.5 billion in bonds by July.
Last month the company said its total debt stood at US$4.2 billion at the end of the first quarter, with a net debt to EBITDA ratio of 4.2.