March 23, 2017 / 10:10 PM / a year ago

BUZZ-Brazil's Renova: cash dearth threatens wind power projects

** Renova Energia SA, a Brazilian renewable power company controlled by Cia Energética de Minas Gerais SA, said a dearth of cash is threatening to stop work on Alto Sertão III-Fase A, a compound of wind farms

** In a conference call with analysts to discuss fourth-quarter results, investor relations director Paulo Ferreira said “the reason why we haven’t made much progress with the project is liquidity ... we just lack the necessary money to continue with the necessary work”

** Renova currently has 683 megawatts of power capacity in operation, and hopes to raise it to 2 gigawatts by 2020. The company lost 424.6 million reais ($135.42 million) last quarter

** Reuters reported on March 3 that a unit of Brookfield Asset Management Inc is nearing an accord to buy a 30 percent stake in Renova, which would include 800 million reais in fresh capital for the cash-strapped firm. The deal is expected to be announced within weeks, a source told Reuters at the time

** The capital injection is needed to help bolster Renova’s balance sheet. The Brookfield stake purchase will be formalized once Renova completes the sale of the Alto Sertão II wind farm project to a local unit of AES Corp

** Units, a blend of Renova’s common and preferred shares, slumped 8.2 pct to 4.04 reais on Thursday. The decline extended the stock’s losses this year to 32.7 pct

$1 = 3.1355 reais

0 : 0
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