Brazil’s largest iron ore miner and steel producer Gerdau has submitted a binding proposal and entered into a share purchase agreement with Brazilian electric utility company, Companhia Paranaense de Energia (COPEL) for the acquisition of COPEL’s entire equity interest in the Dona Francisca Energética S.A. (DFESA) hydroelectric plant, corresponding to 23.03% of its share capital.
The acquisition aligns with Gerdau’s capital allocation plan, enhancing cost competitiveness across its businesses and increasing self-generation to more than 50 percent of its energy consumption, with focus on renewable energy and in line with its decarbonization strategy, the company said.
Gerdau already owns 53.94 percent of DFESA, accounting for 35.6 megawatts (MW) of its energy output. With the acquisition, Gerdau will own 65.94 average MW of firm energy from DFESA.
The transaction implies an enterprise value equivalent to $30 million and is subject to the satisfaction of customary conditions precedent for transactions of this nature, including approval by the Brazilian antitrust authority CADE.
