Transformation of the country’s energy sector opens up new opportunities for the financial market

The Brazilian electric energy sector, currently undergoing a period of significant transformation, gained prominence with the bid organized by the National Electric Energy Agency (ANEEL) for the concession of 15 lots of electricity transmission lines.

The deal was closed at the end of March when an investment fund structured and managed by BTG Pactual purchased three lots of transmission lines and is expected to invest BRL6.5 billion in the states of Rio Grande do Norte, Paraíba, Pernambuco, Bahia and Minas Gerais in the next few years.

Such investment not only strengthens the regional energy infrastructure, but also holds significant job creation potential with more than 12,000 new jobs expected to be created.
 

Water and energy 

Another relevant deal was the sale of 14.7 million shares of the Metropolitan Water and Energy Company (EMAE), which was organized by the São Paulo State government. The project was structured by a consortium of consultants led by Genial Investimentos, who has previously held several similar deals in other Brazilian states.

The transaction was attended by key companies in Brazil’s electricity sector and generated a dispute over the unit price of shares with a premium of 33%, jumping from the expected minimum price of BRL52.82 to BRL70.65 per share, after an intense dispute with more of 57 open outcry bids. The deal exceeded BRL1 billion and the winner was Phoenix Investment Fund, represented by Banco Master de Investimento and its brokerage house.

Through private management, further improvements and investments are expected in the assets managed by EMAE, which is currently responsible for generating energy that supplies 825,000  homes in São Paulo’s metropolitan area. The company also provides services for the transport of 161,000 passengers and 158,000 vehicles monthly via ferry.
 

New opportunities

For the financial market, these transactions represent not only opportunities for new commercial deals, but also a path to contribute to sustainable development and the improvement of domestic infrastructure.

ANEEL has confirmed a new round of auctions in September with investment opportunities estimated at more than BRL4 billion. Furthermore, the Minas Gerais State Energy Company (CEMIG) will sell one Small Hydropower Plant (PCH) and three Hydropower Plants (UHE) in July at an auction held at B3.

Learn more
Check out B3’s auction calendar and watch out for the next auction coming soon!