State Grid Corporation of China (SGCC), a state-owned grid operator, has plans to acquire controlling stake in a CPFL Energia SA, a Brazilian power distributor for R$5.85 billion (US$1.79 billion).
More concretely, SGCC plans to buy 23 % of the company's shares that are currently owned by Camargo Correa SA. The transaction is subject to approval by Brazil's antitrust regulators and electricity sector regulators.
CPFL Energia is the largest non state-owned group of electric energy generation and distribution in Brazil and the third biggest Brazilian electric utility company, after Eletrobras and CEMIG. CPFL Energia and its subsidiaries operates in the segments of generation, distribution and commercialization of electric energy and renewable energy.
The deal is expected to be led by State Grid International Development Co. Ltd., a SGCC's subsidiary created in 2008 to invest in and operate overseas utilities. The firm currently has a 30-year license to operate approximately 6,000 km of power transmission lines that connect some of Brazil's largest cities.