Brazilian power firm Equatorial Energia has agreed to buy wind developer Echoenergia for BRL 6.7 billion (€1 billion).
Echoenergia has built and operates wind farms in north-eastern Brazil with 1GW of installed capacity. It has another 200MW under construction and a portfolio of construction-ready projects with 1.1GW of capacity, consisting of 90% solar and 10% wind.
In a statement to the Brazilian stock market, Equatorial said that the deal would increase its exposure to the country’s growing wind and solar energy sectors which are expected to lead growth in the power generation industry over the next decade. The deal would also add an experienced management team with a proven track record in development, construction, and asset operation, Equatorial stated.
According to a presentation to investors on Equatorial’s website, Echoenergia has three wind farms under construction – the 92MW Echo 8 , {{Echo 9-ee9ed988-96d8-4ce4-1697-30cfe6fada2a}} and 38MW Echo 10 projects – all located in Rio Grande do Norte state and due to enter operations in January 2022.
“The operation is part of the company's growth strategy and will allow the expansion of its operational capacity through the generation of renewable energy, contributing to its consolidation in the Brazilian electricity sector,” Equatorial explained
Echoenergia is currently owned by emerging markets investment firm Actis LLP through its Ipiranga Fundo de Investimento em Participacoes Multistrategia fund.
The deal is subject to approval by Brazil’s competitions regulator CADE and Equatorial shareholders who will vote on the transaction later this year.
Equatorial is a holding company which controls power distribution businesses across Brazil.
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