Iberdrola spends $2.2bn to boost stake in Brazil's biggest power distributor
Spanish renewables giant increases shareholdings in Neoenergia to about 84%
Iberdrola has reached an agreement to buy a further 30.29% stake in Brazil’s biggest power distribution group, Neoenergia.
The Spanish renewables giant will pay Caixa de Previdência dos Funcionários do Banco do Brasil, or Previ, the pension fund of the workers of state-owned bank Banco do Brasil, about €1.88bn ($2.2bn) for the stake that will push its holding in Neoenergia to about 84%.
Neoenergia supplies electricity to close to 40 million Brazilians through distribution companies in five Brazilian states, among them Sao Paulo, and 18 transmission lines with an 8,000 km network. It also has 725,000 km of distribution lines.
The company also operates 3.8GW of renewable generation, mostly in hydropower.
“In the coming years, the company faces strong growth prospects thanks to the expected increase in investments in regulated networks with attractive regulatory frameworks,” Iberdrola said.
The transaction, which is still subject to regulatory approvals, fits into Iberdrola’s growth strategy based on electricity grids businesses, with 1.4 million km of power lines in the US, the UK, Brazil and Spain.
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