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October 19, 2021updated 22 Feb 2022 6:11am

Votorantim and CPP Investments to form renewable energy company

The combined entity’s diversified energy portfolio will include 2.3GW of hydroelectric capacity and 1GW of wind power capacity.

By Umesh Ellichipuram

Brazilian investment company Votorantim and Canada Pension Plan Investment Board (CPP Investments) are to consolidate their energy assets in Brazil.

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The two companies will create an integrated renewable energy firm with an installed capacity of 3.3GW.

The combined entity will have net revenues of BRL5.8bn ($1.05bn), based on the 12 months to 30 June.

Its diversified energy portfolio will include 2.3GW of hydroelectric capacity and 1GW of capacity from wind power assets, as well as 0.6GW of operational capacity.

The process of asset consolidation and public listing will be carried out in two separate transactions.

Under the first transaction, VTRM, a joint venture company of Votorantim Energia and CPP Investments, will acquire the two companies’ equity stakes in various renewable energy assets and consolidate them.

These will include Votorantim Energia’s stake in hydropower assets, Votorantim Comercializadora de Energia, power producer Companhia Energética de São Paulo (CESP), and VTRM’s existing wind and solar assets and projects.

CPP Investments will also invest a further BRL1.5bn to increase VTRM’s capital base.

As part of the second transaction, VTRM has submitted a proposal to CESP’s board of directors for merging CESP’s shares into VTRM and further consolidating assets.

The proposal will be discussed by an independent committee of CESP’s board.

Votorantim president João Schmidt said: “Alongside a partner like CPP Investments, which has shared our long-term views on energy since 2017, we are ready to accelerate our role in the sector.

“Through the assets’ consolidation into a single platform, Votorantim and CPP Investments will share in a new cycle of growth and value generation together with current CESP shareholders, following the highest governance standards of the Novo Mercado segment.”

CPP Investments managing director and sustainable energies head Bruce Hogg said: “We continue to see opportunities to invest in high-quality renewable energy assets in Brazil that are well-suited to our long-term investment strategy.

“This transaction will create a diversified and well-capitalised platform primed for further growth in the country’s power sector.”

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img

How attractive are current investment opportunities in Europe?

Europe has been identified as one of the most favorable regions for investors, seeing high investment activity in the past year. Most of these investments have been through Debt Offering, valued at close to $700 billion. The region has provided attractive investments in a diverse set of companies. Companies who tend to major themes such Digital Media, Cloud, Artificial Intelligence, E-commerce, and Big Data are recording the highest number of deals, with Digital Media recording close to 2,000 deals. However, GlobalData’s whitepaper offers a full view of the market, analyzing less successful or attractive points of investment as well, examining statistics on Equity Offering investments and PE/VC deals. Understand how government agencies for economies around the world use GlobalData Explorer to:  
  • Track the M&A and Capital Raising volumes into their target market
  • Identify the top sectors in the target market attracting the investments
  • For any investment segment, identify the top Investors inside and outside the target economy that are already investing in the Segment
  • Assess and showcase the growth potential for various Industries in the target economy
Don’t miss out on key market insights that can help optimize your next investment – read the report now.
by GlobalData
Enter your details here to receive your free Report.

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