China Three Gorges closes in on Chaglla deal

China Three Gorges closes in on Chaglla deal

M&A Project & Infrastructure Finance Economy & Policy Politics Peru Brazil

A group led by China Three Gorges is close to wrapping up the acquisition of the Chaglla hydroelectric power plant in Peru, the justice ministry said in a statement.

The consortium, Chaglla Holding Limited, reached an agreement to buy the plant from Brazil's Odebrecht for $1.39bn in August 2017, but the deal faced delays as the government determined how much money from the sale Odebrecht had to hand over to cover the fines from a widespread corruption case.

After deducting $752m in debts and taxes, the sale price comes to $638m. Odebrecht has to deposit half that amount, or $319m, in a trust managed by the state-owned Banco de la Nación, the ministry said.

Odebrecht has admitted to paying $30m in bribes in Peru, but it is close to reaching a plea bargain with prosecutors, according to press reports.