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Vale may up stake in Aliança Energia
Posted on Tuesday, 14 January 2020 15:09
Valor Econômico reported that Brazilian metals and mining player Vale is considering increasing its holding in Aliança Energia, which it currently operates as a joint venture with Companhia Energética de Minas Gerais (Cemig). Without citing its sources, the news provider said discussions are underway between the parties and Banco Santander has been appointed to advise the prospective suitor on the matter. None of the parties involved have commented on the report at this time. Reuters picked up on the news and noted that the takeover is in line with the acquiror’s priorities, which include the generation of cheap electricity for its mining unit, while it noted that the move would also comply with Cemig’s need to raise cash. Aliança Energia was established in 2015 and now claims to be one of Brazil’s largest private power generation companies. The firm hopes to reach installed capacity of 1.60 GW by 2023; the figure currently stands at 1.26 MW, spread across a portfolio of seven hydroelectric plants and one wind farm. It posted gross profit of BRL 351.41 million (USD 84.89 million) in 2018, down from BRL 370.29 million over the preceding 12 months. Zephyr, the M&A database published by Bureau van Dijk, shows there were 1,652 deals worth a combined USD 115.47 billion targeting electric power generation companies announced worldwide during 2019. This represents an improvement on 2018’s 1,567 deals in the sector, although value declined from USD 135.22 billion over the same timeframe. 2019’s largest deal targeting an electric power generation firm was worth USD 7.60 billion and took the form of a capital increase as Russia-based Atomnyi Energopromyshlennyi Kompleks issued stock to Gosudarstvennaya Korporatsiya po Atomnoi Energii Rosatom. This was followed by a USD 6.10 billion buyout of US-headquartered Pattern Energy by Canada Pension Plan Investment Board, via its Pacific US vehicle. © Zephus Ltd