Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Brazilian steelmaker CSN SA on Friday made the winning bid in the privatization auction of power generator CEEE-G for 928 million reais ($178.71 million).
The offer, made through its subsidiary Companhia Florestal do Brasil, represented a 10.93% premium over the initial auction price.
The company succeeded after a bidding war with Auren Energia, which is controlled by Brazilian conglomerate Votorantim SA and Canada’s CPPIB.
CEEE-G, a power generator based in the southern state of Rio Grande do Sul, owns 990 megawatts (MW) in installed capacity, mainly from hydroelectric dams. Including stakes in other companies, its portfolio reaches 1.27 gigawatts (GW).
CSN will now have to pay 1.66 billion reais for a new 30-year concession contract.
($1 = 5.1929 reais)
(By Leticia Fucuchima and Peter Frontini; Editing by Christian Plumb and Brendan O’Boyle)
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