Latin America: Engie cancels sale to ContourGlobal over price dispute

13 April 2018 - 12:00 am UTC

Engie ’s decision to cancel the sale of two thermoelectric power plants to ContourGlobal was due to a disagreement over valuation, Inframation has learned.

A source close to the transaction said Engie backed out of the sale of the 857MW Jorge Lacerda and 340MW Pampa Sul thermoelectric plants because it believed the UK energy company had undervalued the assets.

The source declined to provide further details about the price offered, but said Engie remained committed to selling the assets to another buyer.

Deutsche Bank acted as broker on the sale, according to the same source. Deutsche Bank declined to comment on the transaction.

Engie is working with US law firm Orrick, Herrington & Sutcliffe LLP and local firm Mattos Filho, Veiga Filho, Marrey Jr. e Quiroga Advogados on the sale. ContourGlobal is understood to have hired Pinheiro Neto Advogados. All three firms confirmed their participation, but declined to comment on the transaction.

A spokesperson for Engie referred to a company statement issued on 10 April. ContourGlobal did not respond to requests for comment.

According to the statement, Engie pulled out of negotiations with ContourGlobal because they “have not progressed satisfactorily” and the company “decided to examine alternatives.”

In December, ContourGlobal was granted exclusivity rights to conduct due diligence on the two thermoelectric power plants.​​​​​​