Engie Brasil to buy two hydro power plants for $523 million

(Reuters) – Power firm Engie Brasil said on Friday it had signed a contract to buy two hydro power plants in northern Brazil for about 3 billion reais ($523.2 million), according to a securities filing.

Engie Brasil is buying the entities which hold the concessions to run the Cachoeira Caldeirao plant, located in Amapa state, and the Santo Antonio do Jari plant, on the border of Amapa and Para states.

The concessions end in 2048 and 2045, respectively.

The assets, which are being sold by EDP Energias do Brasil and China Three Gorges Energia, together have 612 megawatts of installed capacity.

“The transaction will create value for shareholders by allowing us to allocate capital to assets that are already operational and with secure, long-term revenues,” CFO Eduardo Takamori said in a statement.

The value of the deal, which still needs approval from Engie’s shareholders and Brazilian regulators, reflects some 2.3 billion reais in equity value and 672 million reais in net debt, Engie Brasil said.