State Grid may reach agreement on acquiring Abengoa assets in Brazil in short term
State Grid, the Chinese electricity company, expects to reach an agreement in the short term to acquire Spanish company Abengoa’s electricity transmission projects in Brazil, according to a newswire report.
The Reuters report cited State Grid Vice President for the Brazilian unit Ramon Haddad for the information.
The Spanish-language news report said the deal is extremely complicated due to the diversity of Abengoa assets in Brazil. The European company has 3,500 kilometers of operating transmission lines, and 6,300 kilometers of unfinished lines in the Latin American nation. For each project, the company has different suppliers, contracts and financing deals that make the negotiations very complicated.
Haddad said, the report noted, that State Grid has the capacity to take over the projects, and is looking forward to it, because it is a good deal for the company.
State Grid has completed due diligence on the assets, and is now being analyzed by State Grid headquarters in China, the report said, adding that State Grid is considering presenting a two-step offer.
Haddad said the company is interested in Celg-D, the distribution company controlled by Eletrobras in the Brazilian state of Goias. He said the company will finally decide whether it will participate in the auction once the prospect is released, the report said.