Zuma Energía engaged Bank of America Merrill Lynch (BAML) to sell the Mexican energy company, Inframation understands.
British fund manager Actis and Costa Rica-based Mesoamerica currently own Zuma in a 70:30 equity split. The partners launched a sale process in July and received an unspecified number of non-binding bids last week, according to two investment bankers and a lawyer with knowledge of the process.
Advising Actis on the deal is Mijares, Angoitia, Cortes y Fuentes (legal), said the lawyer.
Actis declined to comment and Mesoamerica did not respond to a request to comment in time for publication.
One of the investment bankers, who is considering representing a client in the second round, said that the platform could be ripe for big institutional investors in Canada but noted that CDPQ would be unlikely to bid as it had recently made a sizeable investment in Enel’s Mexican energy portfolio.
This echoes the sentiments of Zuma Energía board member Michael Harrington, who in June told Inframation’s sister publication Mergermarket that a sale to a strategic investor was the most likely exit route for Zuma’s sponsors.
The investment banker also said that the platform represents an excellent opportunity for companies to get a foothold in the crowded renewable energy market.
Founded in September 2014 to capitalize on the opening of Mexico’s energy sector to private and foreign investors, Zuma operates the 49.5MW Ingenio wind farm in the southern Mexican state of Oaxaca. In September 2014, Actis Energy Fund 3 invested USD 245m for a 70% stake in the company.
Zuma Energía is currently focused on finishing the construction of three more renewable projects – a 424MW wind farm (Reynosa) in the northern state of Tamaulipas, for which it received USD 615.5m from Bancomext, Banobras, Nafinsa and Santander; a 158MW solar farm (Orejana) in the northern state of Sonora; and a 178MW solar project (Santa Maria) in Chihuahua.
Reynosa is expected to begin commercial production before year-end, while Orejana and Santa Maria are scheduled to start producing energy in 2019, as reported.