August 16, 2019 / 9:50 PM / a month ago

Brazil power company CPFL eyeing Cemig: CEO

SAO PAULO (Reuters) - Brazilian power company CPFL Energia (CPFE3.SA) is in an expansion phase that could include the purchase of fellow utility Companhia Energetica de Minas Gerais (CMIG4.SA), known as Cemig, CPFL Chief Executive Officer Gustavo Estrella told Reuters on Friday.

“Cemig is in the same region as CPFL, so it’s an asset that we would have to look at and evaluate,” Estrella said in an interview.

Earlier on Friday, Cemig CEO Cledorvino Belini said its privatization may be approved this year. According to data from Refinitiv Eikon, Cemig, which is controlled by Minas Gerais state, has a market value of about 22 billion reais ($5.5 billion).

The strategy for CPFL, which is controlled by State Grid Corporation of China, is to look at a wide range of assets from generation and renewables to distribution and transmission lines, Estrella said, also noting the company’s drive to reduce debt.

“The size of CPFL and the size of our shareholder should give an indication on the scale of the company’s ambitions. So we don’t rule out any potential assets,” Estrella said.

State Grid, the world’s largest electric company, paid 14.2 billion reais for control of CPFL in early 2017.

Reporting by Luciano Costa; Writing by Jamie McGeever; Editing by Cynthia Osterman

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