Odebrecht Latinvest, a subsidiary of the Odebrecht Group dedicated to infrastructure concessions in Latin America, has signed an agreement with a consortium led by one of the world’s largest power generation companies, the China Three Gorges Corporation (CTG), to sell the Chaglla hydroelectric plant, the third largest in Peru with installed capacity of 456 MW.
The consortium led by CTG is composed of Hubei Energy Group Co., Ltd. (“Hubei Energy”), Ace Investment Fund II LP (“ACE”), and CNIC Corporation Limited (“CNIC” and, together with ACE and Hubei Energy, the “Consortium”). The Chaglla hydroelectric plant is managed by Empresa de Generación Huallaga S.A. (EGH). The concession will be acquired through Huallaga Holding Company Limited, a company created by the consortium and organized under the laws of the Hong Kong Special Administrative Region and the People’s Republic of China.
The consummation of the transaction will be subject to customary closing conditions, including approval from the Peruvian Ministry of Justice pursuant to Urgency Decree 003-2017. The deal is also subject to regulatory approvals from certain Chinese government entities.
Odebrecht’s financial advisors in the transaction are Itaú BBA, Scotiabank and SMBC Nikko. The company has also hired White & Case LLP to provided legal advisory services. The Consortium’s financial advisor is Bank of America Merrill Lynch and its legal advisor is Sullivan & Cromwell LLP.
Chaglla is a hallmark of the Peruvian energy infrastructure. At a height of over 200 meters, it is one of the largest concrete-faced rockfill dams in the world. Its generation capacity accounts for approximately 10% of the country’s total installed hydroelectric capacity and approximately 4% of the country’s total power generation. Recently the project was recognized with the “International Milestone Rockfill Dam Project”, the most important global distinction in the field of dam construction. Chaglla was also featured in “Better Hydro: Compendium of Case Studies 2017,” published by the International Hydropower Association in collaboration with the World Bank Group, for its assessment of the construction project’s social and environmental risks and for its engagement with the local communities impacted by the project
About Odebrecht Latinvest
Odebrecht Latinvest is an Odebrecht Group company dedicated to managing infrastructure concessions in all countries of Latin America, except Brazil. Created in 2012, it designs projects, raises capital, invests and operates infrastructure assets in the transportation, energy, irrigation and pipeline segments, with the focus on operational excellence and creating value for customers and shareholders. It participates as a capital investor and operator of concessions developed or acquired by the Odebrecht Group, benefiting millions of users.
About the Odebrecht Group
Founded in 1944, Odebrecht is a Brazilian company with a global footprint, present in 25 countries. Its nine Business Units operate in the petrochemical, engineering & construction, infrastructure, agroindustrial, oil & gas, transport, real estate and naval industries. Each Business is self-sufficient financially and operationally, in addition to having its own governance structure, bolstered by a fully operational Compliance system and the commitment of all Team Members to act with ethics, integrity and transparency. The Odebrecht Group has around 80,000 employees belonging to diverse nationalities and exports products and services to approximately 100 countries.