Investment fund Angra Partners has taken control of troubled Brazilian wind developer Renova Energia after buying the stake of Companhia Energética de Minas Gerais (Cemig) for BRL 60 million ($11 million).
Following the deal, Angra now owns 30.3% of Renova’s shares and exercises control through a pact with other shareholders. Prior to the transaction, it had owned 3.08% of Renova.
Cemig's stake in Renova at the time of the deal with Angra Partners represented 13.81% of shares. It had been reduced from 36.23% as a result of debt to share conversion carried out as part of the judicial restructuring process.
The deal brings to end a troubled two years, which began when Renova filed for bankruptcy protection in October 2019.
Angra’s “assumption of control of the company reaffirms the trust and attractiveness in Renova and recognises the success of the judicial restructuring process approved in December 2020,” Renova explained.
The company’s main aim now is to complete construction and commission the first phase of the Alto Sertao III wind farm in the northern state of Bahia. Consisting of 155 turbines distributed between 26 sites, it will have an installed capacity of 432.7MW, making it one of the ten largest wind farms in Latin America, according to Renova.
The company is also developing a pipeline of renewable energy projects in north-eastern Brazil with 6GW of installed capacity, including 1.5GW of wind energy capacity.
Cemig, which has been selling assets to reduce debt levels since 2017, owned a 36.23% stake in Renova but wrote down the value of the shares to zero.
Renova is also facing an ongoing investigation by state and federal police over corruption, misappropriation of funds and has been accused by the tax authority of underpaying income and payroll taxes by around BRL 89 million ($16.3 million).