Actis has sold its 92% stake in Energuate, Guatemala’s largest electricity network, to IC Power, a wholly-owned subsidiary of New York Stock Exchange-listed Kenon Holdings. IC Power paid US$265 million for the purchase of Actis’ stake, and will assume gross debt of the Energuate business of approximately US$289 million.
Energuate includes two electricity distribution companies in Guatemala that provide services to 1.6 million customers across 100,000 square kilometres covering 10 million people, representing 60% of Guatemala's energy distribution market.
The transaction reflects the Actis’ proven success, replicable strategy of acquiring and enhancing energy distribution businesses in high growth markets. Under Actis’ management, Energuate added over 230,000 customers from May 2011 to the selling date.
Mike Till, partner and co-head of energy at Actis, said:
“We are delighted with what we have achieved over the last four years, growing the business and supporting Guatemala’s economic growth by providing much needed energy infrastructure. The sale reflects the confidence in the potential of the energy sector in Central America. We wish the business well in its next stage with IC Power. Guatemala continues to be attractive to Actis as an investment destination. Favourable demographics are driving growth and a positive consumer environment in Guatemala. The country boasts a large and fast-growing population, high GDP per capita growth, rising urbanisation levels, and an expanding middle class.”
The investment in Energuate builds on Actis’ expertise in the electricity and distribution sector. The firm previously backed Umeme, a leading power provider in Uganda where it remains a 14% shareholder following the company’s successful IPO in 2012. It also holds a 51% stake in Cameroon’s national integrated utility, ENEO.