Copel sells out of Enercan, buys Elejor control

Brazil's Parana state integrated power company Copel (NYSE: ELP) has signed an agreement to buy 30% of the Elejor specific purpose company that has the concession for the 238MW Santa Clara-Fundao hydroelectric generation complex, Copel said in a statement. The company has also sold its 16.7% stake in the Enercan consortium that is building the 880MW Campos Novos hydro project, Copel said in a separate statement. The moves are part of Copel's strategic plans to concentrate its operations within Parana state, a company spokesperson told BNamericas. The strategy determined by Roberto Requiao when he took over as state governor in January 2003 is that Copel only participates in projects outside of Parana when it has a majority stake, the spokesperson said. Enercan is on the river Canoas in neighboring Santa Catarina state. It was 50% complete in October this year, and is on course for completion by January 2006. Copel will however keep a 23% stake in the 125MW Dona Francisca hydro power plant in Rio Grande do Sul state since it is already producing electricity, the spokesperson said. The voting right stake that aluminum producer CBA and nickel company CNT bought in Enercan, which is controlled by the CPFL Generacao generation arm of distributor CPFL, was estimated at 80mn reais (US$28mn), the spokesperson said. The two metal producers are exercising their right of first refusal as project partners. Copel agreed to buy the 30% in Elejor (Centrais Eletricas do Rio Jordao) from Triunfo Participacoes for 37.2mn reais, the spokesperson said. Copel now owns 70% of voting shares, and 35% of total capital. Elejor is building the Santa Clara and Fundao plants, both of which have 119MW installed capacity, on the Jordao river in Parana state and are due start operating in 2005. Copel has made 7.2mn real down payment and is awaiting approval from authorities before paying the remaining 30mn reais, the spokesperson said. Power regulator Aneel has to approve both transactions for them to be finalized. Copel has 4,500MW installed capacity and distributes energy to about 3 million clients in Parana state.