The shareholders of Brazilian energy company MPX have agreed on a private capital increase of R$800 million (€ 0.3 billion1) at a price of R$ 6.45 (€ 2.211) per share.
E.ON is supporting this capital increase by a firm commitment of approximately R$0.4 billion (€ 0.1 billion1).
“E.ON welcomes the capital increase, which will provide the company with the financial strength to realize its tremendous growth potential,” said E.ON CEO Johannes Teyssen. “The conventional and renewable assets in its development portfolio will enhance Brazil’s security of supply and create significant value for the company as well as E.ON. The fundamentals underlying these projects remain highly promising.”
Eike Batista stepped down as a Member and as Chairman of the MPX Board of Directors. Jørgen Kildahl, Member of the Board of Management of E.ON SE, was appointed Chairman for an interim period.
Jørgen Kildahl stated: “E.ON appreciates Eike’s great contribution to developing MPX to be one of the leading energy companies in Brazil since he founded it in 2001. Building on this, E.ON now is supporting the further development of MPX, a fundamentally solid company, and the successful implementation of its ambitious and promising project pipeline.”
MPX will be renamed and its headquarters relocated to the offices of the existing E.ON-MPX joint venture.
The agreed private capital increase, which will be implemented approximately within the next 40 days, is supported by the firm commitment of R$0.4 billion (€ 0.1 billion1) from E.ON, with BTG Pactual committed to cover the remainder. Brazil Development Bank BNDES, which is also a significant shareholder, is currently analyzing whether to participate in the capital increase.
This private capital increase is replacing the originally envisaged public offering after market conditions have substantially worsened in the last few weeks. The amount of money collected via this capital increase will give the company enough liquidity to fulfill its business plan.
MPX, which has 1.7 gigawatts (GW) of generating capacity in operation and a further 1.1 GW that will come online by the end of 2013, will use the new liquidity to continue implementing the delivery of its 10 GW portfolio of conventional and renewable power projects. The company is also making preparations to expand its project portfolio and to bid in auctions for new generating capacity.
Johannes Teyssen stated: “Based on the agreements we have made with the other shareholders, MPX is now in a position to speed up significantly and to focus on the implementation of its ambitious growth plan. As one of the controlling shareholders and based on our experiences, skills and capabilities, we will support the company in becoming a key player in the Brazilian energy market and take profit from the company’s growth and deliver on the targets we have set for our businesses outside Europe.”
1Approximate exchange rate: R$2.92 = €1.This press release may contain forward-looking statements based on current assumptions and forecasts made by E.ON Group management and other information currently available to E.ON. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of the company and the estimates given here. E.ON SE does not intend, and does not assume any liability whatsoever, to update these forward-looking statements or to conform them to future events or developments.