E-Paper
BTG-Backed Utility Eyes Eletrobras Plants, Still Targets Vibra
Natural gas and power producer Eneva SA is looking to grow in Brazil by purchasing thermal plants from Eletrobras and merging with fuel distributor Vibra Energia SA.
Natural gas and power producer Eneva SA is looking to grow in Brazil by purchasing thermal plants from Eletrobras and merging with fuel distributor Vibra Energia SA.
Winning the bid for the power plants would mean a multi-billion dollar expenditure, with the company backed by BTG Pactual SA and the Moreira Salles family able to fund the acquisition with cash, debt or equity issuance, Chief Financial Officer Marcelo Habibe said in an interview.
“We’re completing the due diligence to submit a formal offer by the end of the month,” Habibe said.
READ MORE: Vibra CEO Dismisses Idea of Eneva Talks, Not Seeking Other Deals
The Eletrobras assets and the merger talks with Vibra – which, according to Habibe, continue despite a recent denial from Vibra – are the only deals Eneva is currently targeting. Eneva, which attempted and failed to acquire some of Petrobras’s onshore fields when the state-controlled producer was still divesting, rules out another attempt for oil assets at this time, the CFO said.
State-controlled Petrobras has halted asset sales under current management and Brazil’s independent oil producers are expected to go through a consolidation phase.
Eneva had strong operating results in the fourth quarter, partly because a heat wave triggered by the El Nino weather pattern boosted demand for power from its gas and coal plants. The company had record revenue of 2.7 billion reais , while earnings before items jumped 84%. However, the power company had a net loss due to write-offs.
After a month and a half of operating at capacity, Habibe said the thermal complex was disconnected in February. A resumption of electricity exports to Argentina should compensate for the decline in thermal power demand in the first quarter of 2024, which should pick up around the middle of this year.
“Even if the temperature is not so high in Brazil, there will be less hydro generation available,” Habibe said.
This article was generated from an automated news agency feed without modifications to text.
