NEW YORK (Reuters) - Brazilian state-run electricity utility Companhia Energética de Minas Gerais (CMIG4.SA) (Cemig) is considering a strategic partnership as part of its plan to divest its stake in Light SA (LIGT3.SA), the company’s chief financial officer said on Monday.
“We continue to pursue selling this year if not (all) the shares at least part of that, bringing on board maybe a strategic partner,” said Mauricio Fernandes before ringing the closing bell at the New York Stock Exchange.
“We continue to consider M&A but we are open to new possibilities,” he said.
Cemig is looking to sell its controlling stake in Light to raise cash and cut debt.
Following a recent issuance that he called “a real success,” Fernandes said Cemig will continue to tap markets when conditions are favorable, though likely not in the near future.
“It is good that Cemig (remains) in the market,” he said, “it is important to keep this door open.”
He said his focus continues to be on divesting non-essential assets, improving operational efficiency and deleveraging.
“If we continue to be able to sell certain assets that are not linked to our core business ... bringing those funds to Cemig would accelerate the deleveraging, potentially bringing more favorable conditions for us to do new issues,” Fernandes said.
Cemig's Sao Paulo-based stock is up more than 26 percent so far in 2018 compared with a 5.1 percent year-to-date gain in the Brazilian benchmark .BVSP, and its dollar-denominated shares (CIG.N) are up 4.4 percent despite a sharp devaluation of the real against the greenback BRL=.
“The company has been capitalized, the debt re-profiled, we’ve been successful in implementing measures in order to leverage operational efficiency,” Fernandes said.
Reporting by Rodrigo Campos; additional reporting by Luciano Costa in Sao Paulo; Editing by Lisa Shumaker and Tom Brown