October 16, 2019 / 10:31 AM / a month ago

Brazil's Renova Energia files for bankruptcy protection to restructure $742 million debt

SAO PAULO (Reuters) - Brazilian renewable energy firm Renova Energia SA (RNEW11.SA) has filed for bankruptcy protection, aiming to restructure a total debt of around 3.1 billion reais ($741.70 million), it said in a securities filing on Wednesday.

The bankruptcy filing comes two days after key shareholder Light SA (LIGT3.SA) sold its 17.17% stake in Renova to an investment fund for a symbolic value of 1 real, in a decision that followed failed talks to sell heavily indebted wind farm projects.

On Monday, Renova’s Chief Financial Officer Claudio Ribeiro resigned in the aftermath of Light’s announcement, leaving Chief Executive Cristiano Corrêa de Barros temporarily overseeing the area until a replacement is found.

The exits of Light and Ribeiro follow years of unsuccessful talks to sell Renova’s wind farm projects, which have racked up debt and raised concerns about their timely completion.

Negotiations to sell the projects to AES Tiete Energia SA (TIET11.SA), a subsidiary of AES Corp (AES.N), broke down last week after six months of talks.

Renova has been trying to sell some of its wind projects for more than two years. Before AES, the company was in talks with Canada’s Brookfield Asset Management Inc (BAMa.TO), which ended with no agreement in July 2018.

Renova’s shares traded on the Sao Paulo stock exchange have fallen almost 32% so far this year, adding to a 64.2% drop in 2018.

Reporting by Gabriela Mello, editing by Louise Heavens

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