Brazil’s Auren Energia to bid in privatization of CEEE-G; CSN to bid alone as EDF drops out -sources

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SAO PAULO — Brazilian power holding company Auren Energia has delivered a proposal to participate in the privatization auction of power generator CEEE-G, based in the southern state of Rio Grande do Sul, three sources with knowledge of the matter said on Wednesday.

Auren Energia is controlled by Brazilian conglomerate Votorantim SA and Canada’s CPPIB.

France’s EDF, which was planning a joint bid with Brazilian steelmaker CSN in the auction on Friday, has dropped out earlier this week, the sources added, asking for anonymity to disclose private discussions.

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One of the sources said CSN intended to deliver a bid on Friday even without its former partner EDF.

Proposals to participate in the auction, which has a minimum price of 837 million reais ($158 million) were delivered on Tuesday. The auction will be held on Brazilian stock exchange B3 headquarters on Friday afternoon.

Depending on the need to buy out other shareholders including Centrais Eletricas Brasileiras, known as Eletrobras , the minimum price may rise to 1.2 billion reais.

CEEE-G owns 990 megawatts (MW) in installed capacity, mainly from hydroelectric dams. Including stakes in other companies, its portfolio reaches 1.27 gigawatts (GW).

One of the sources said Auren Energia sees value in the CEEE-G energy that may be sold on the spot market. Auren owns one of the largest power trading companies in Brazil.

EDF had been interested in the generator since the regional Rio Grande do Sul government first tried to privatize the company, last March.

But the company dropped out of the process earlier this week, one of the sources added. Although the reason was not clear, the ongoing EDF nationalization by the French government makes it difficult to approve new large investments abroad, the source added.

Auren Energia, EDF and CSN did not immediately comment. (Reporting by Leticia Fucuchima and Tatiana Bautzer Editing by Marguerita Choy)

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