Suez Energy wins stake in Brazil’s 1,140-MW Machadinho

Belgium-based Suez Energy was winning bidder for a 12.16 percent stake in Brazil’s 1,140-MW Machadinho hydroelectric project, which was sold by utility Centrais Eletricas de Santa Catarina S.A. (Celesc).

Celesc sold its share of the project in a December 1 auction on the Sao Paulo stock exchange, Bovespa. (HNN 11/13/06) Bovespa announced the results, which were reported by Business News Americas.

Through a subsidiary, Delta Energetica, Suez offered to pay 116.5 million reais (US$53.8 million), outbidding part-owner Departamento Municipal de Eletricidade do Pocos de Caldas (DME), which holds 2.4 percent of the project, located in Rio Grande do Sul State.

DME is part of the Machadinho controlling group, Maesa, which owns a total of 83.06 percent of the project. The acquisition by Suez only will be confirmed if all Maesa shareholders decline to exercise their rights to buy the stake at the bid price.

Suez already indirectly owns 16.94 percent of Machadinho through its wholly owned unit Tractebel Energia. Other owners are aluminum company CBA, 24.18 percent; U.S. aluminum company Alcoa, 22.61 percent; aluminum company Valesul, 7.28 percent; cement maker Rio Branco Cimentos, 4.93 percent; cement maker Camargo Correa Cimentos, 4.63 percent; and utility Companhia Estadual de Energia Eletrica, 4.86 percent.

The sale is part of Celesc’s plans to divest generation assets to comply with Brazilian law requiring utilities to separate their distribution operations from their generation business.

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