June 2, 2017 / 6:57 PM / 2 years ago

Brazil's Eletrobras CEO eyes sale of six distribution units by year-end

RIO DE JANEIRO (Reuters) - Brazilian state-run power holding company Centrais Elétricas Brasileiras SA plans to sell six energy distribution companies by early December, Chief Executive Officer Wilson Ferreira Jr. said on Friday.

In an interview with Reuters, Ferreira said development bank BNDES is fleshing out the details of the transaction. He expects the sale of the units, based in the northern and northeastern regions of the country, to take place between late November and early December.

Eletrobras, as the company is known, is also looking to raise around 5 billion reais ($1.5 billion) from the sale of power generation and transmission assets, Ferreira said. Grupo BTG Pactual SA has been hired as a financial adviser and is expected to deliver a precise valuation by July.

That would pave the way for a sale in the second half of the year, with assets bundled in two separate groups: one comprised of wind farms and another comprised of power transmission lines.

Since taking over the helm at Brazil’s largest power group about a year ago, Ferreira has spearheaded ambitious divestment and cost-cutting efforts, seeking to curb debt and free up capital for other projects.

Ferreira did not rule out selling Eletrobras’ 50 percent stake in the Belo Monte hydroelectric dam, one of the world’s largest. The power company is in touch with the other owners of the power dam, who are considering hiring investment banks to sell their holdings, he said.

“We may join them in the sale, depending on the proposals,” he said.

Cia Energética de Minas Gerais , Brazil’s No. 3 power utility, on Thursday officially included its stake in Belo Monte in a 6.5 billion real asset-sale plan.

Writing by Tatiana Bautzer; Editing by Jonathan Oatis and Lisa Shumaker

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