Centrais Elétricas Brasileiras SA, the Brazilian power company known as Eletrobras, has drawn preliminary interest from Chinese state-owned enterprises for its stake in nuclear firm Eletronuclear, according to people with knowledge of the matter.
Prospective bidders include China National Nuclear Corp., China General Nuclear Power Group and State Nuclear Power Technology Corp., the people said, asking not to be identified because the information is private. Rio de Janeiro-based Eletrobras is working with financial advisers as it weighs a sale of its roughly 36% stake in Eletronuclear’s voting capital, and 68% of the company’s total capital, the people said.
A transaction could value the stake at $1 billion to $2 billion, the people said. Other global energy firms might also express interest in the asset, they said.
Deliberations are ongoing and no final decisions have been made, the people said.
A representative for Eletrobras declined to comment while the Chinese firms didn’t respond to requests seeking comment.
A potential deal may occur after Eletrobras got support from Brazil’s government to pursue the Eletronuclear sale plans. Folha de S.Paulo reported the stake sale considerations.
Eletrobras, Brazils’s biggest utility, has recently faced challenges including pushback from minority shareholders against board nominees put forward by the company’s leadership. It is also navigating major government reforms in the sector.
— With assistance from Ocean Hou, Francois De Beaupuy, Joao Lima, and Steven Yang
Source: Bloomberg
