When Italy's largest power company, Enel, and its Spanish
subsidiary Endesa, looked for global growth opportunities,
Latin America's demographics made the region a frontrunner.
Their plan to achieve this growth involved raising capital
through a local Latin American subsidiary. The move offered a
double benefit: bringing in expansion cash and a chance to
streamline a tangled corporate structure that was a result of
years of acquisitions.
EQUITY FOLLOW-ON: Enersis $6 bn equity raise
The Chilean power company overcame disagreement with pension funds and a skeptical market to raise funds for expansion and streamline a complicated group structure
Endesa, with assets scattered across five Latin American
countries, chose Chilean power company Enersis as the unit
through which to consolidate its regional operations.
"Endesa considered it best to have a single vehicle, and
that Enersis offered the best option for growth, with an
attractive, diversified asset base across the region," says
Eduardo Escaffi, chief financial officer of Enersis.
Under the consolidation and capital-raising plan, Endesa
would buy around half of Enersis's rights issue by putting
forward its assets. The other half...
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