SN Power forms renewable energy JV in Brazil
Rio de Janeiro/Oslo 15.08 2011 – SN Power has entered into an agreement to acquire a major shareholding in the Brazilian renewable power company Desenvix. The acquisition marks the largest transaction SN Power has undertaken to date, and together with the recently acquired Enerpar energy trading company, positions SN Power in the fast growing Brazilian energy market - a target market for SN Power.
Desenvix, the power generation arm of the Brazilian engineering company ENGEVIX, has a portfolio of renewable energy assets of 162 MW in operation, 176 MW under construction, as well as a large portfolio of projects under development of about 1600 MW. The assets are mainly hydropower, but also include three wind farms and a biomass plant under construction. The transaction also includes Desenvix´ 50% shareholding in Enex, a company specializing in Operation & Maintenance of small and medium sized hydroelectric plants.
Through the acquisition of a 40.65% shareholding in Desenvix, SN Power will form a Joint Venture partnership with Desenvix´current owners Jackson and Funcef to focus on further hydropower development in Brazil. Following the acquisition, SN Power and Jackson will have joint control of Desenvix with a 40.65% shareholding each, while Funcef will retain a minority shareholding of 18.69%. Jackson is also the owner of the Brazilian engineering company Engevix and Funcef is Brazil´s 3rd largest pension fund.
The hydropower development pipeline of Desenvix is strategically located in the South and Southeast regions of Brazil. As part of the acquisition agreement, SN Power and the present owners of Desenvix have developed a joint business plan which aims to reach 1,000 MW by 2018, focusing mainly on hydropower.
“This partnership in Desenvix represents a match with the strategy of SN Power for Brazil, as it provides solid partners, sound operating assets, and an experienced local organization with a proven track record”, said Torger Lien, CEO of SN Power. “The development pipeline of Desenvix represents enough quality hydropower projects for SN Power to reach its growth objectives in Brazil in the short term and to create value going forward, and we also see significant synergies with our recently acquired Enerpar trading business,” he continues.
The transaction represents an investment for SN Power of approximately MUSD 440 (MBRL 706). Closing of the transaction is expected to take place during the next 6 months, pending approval from Brazilian regulators.