Iberdrola has announced a takeover bid for the remaining 16.2% of Brazilian electricity company Neoenergia.

Currently, Iberdrola holds 83.8% of Neoenergia’s share capital.

The new offer would allow the group to acquire 100% ownership of Neoenergia, further strengthening its commitment to the Brazilian market.

The Iberdrola Neoenergia takeover bid follows the company’s recent acquisition of a significant stake from Caixa de Previdência dos Funcionários do Banco do Brasil (PREVI).

Iberdrola is offering 32.5 reais ($6.01) per share, the same price paid in its recent PREVI transaction, with the amount updated according to Brazil’s official Special Settlement and Custody System (SELIC) interest rate.

The total expected disbursement for this acquisition is around €1,03m before any updates for the SELIC rate and assuming Neoenergia does not pay any interim dividends.

The transaction is expected to simplify Neoenergia’s corporate structure, providing greater operational and financial flexibility and reducing costs associated with maintaining the trading of shares on the market.

Iberdrola said this move underscores its commitment to Brazil and its growth model centred on electricity grids, which account for about 90% of Neoenergia’s business.

Neoenergia supplies electricity to nearly 40 million people in Brazil through distributors across Bahia, Rio Grande do Norte, Pernambuco, São Paulo, Mato Grosso do Sul, and Brasília, as well as 18 transmission lines.

This makes Neoenergia the leading distribution group in Brazil by customer numbers, according to Iberdrola’s news release.

Neoenergia is active in 18 states and the Federal District, overseeing more than 725,000km of electricity distribution lines and 8,000km of transmission lines.

The company also has 3,800MW of renewable generation capacity, mainly from hydroelectric sources.

Globally, Iberdrola manages 1,400,000km of electricity transmission and distribution lines across the US, the UK, Brazil, and Spain.