ISA CTEEP is constantly evaluating growth opportunities in the market, having recently made advances in this direction. The Company’s strategy consists in expanding its presence in Brazil through auctions and/or acquisitions with synergies with existent operations.
In line with its growth strategy and in accordance with the Material Fact published on April 6, 2018, ISA CTEEP signed a Share Purchase Agreement with Cymi Construções e Participações S.A. (“CYMI”) to acquire 50% of the capital stock in Interligação Elétrica Sul A.A. (“IE SUL”) for the amount of R$ 20 million. The conclusion of the acquisition is still subject to the approval and agreement of certain third parties. Once completed, the Company will assume full control of this subsidiary.
In the last two years, the Company has bid successfully for ten lots in ANEEL transmission auctions which will add 1.3 thousand kilometers of extension to its transmission lines with an addition of 7.5 thousand MVA to its portfolio. The new projects amount to an estimated CapEx of R$ 2.9 billion, representing an increase in RAP of approximately R$ 448 million, once all assets are operational.
The implementation of the projects is in line with the challenging estimated budget and timeframe, which builds in a reduction in CapEx and the start up ahead of schedule.
The IE Itapura and IE Itaquerê subsidiaries, both wholly-owned by ISA CTEEP, began their construction in May and July 2018, respectively, according to the established schedule.
|50%||Minas Gerais||171||0,0%||36||Real Profit||Feb/17||Feb/22||Jan/192||3Q19|
|100%||Espírito Santo||298||25,1%||47||Presumed Profit||Feb/17||Feb/22||Jul/18||3Q18|
|100%||São Paulo||398||44,5%||46||Presumed Profit||Aug/17||Aug/21||Jun/18|
|100%||São Paulo||126||57,6%||11||Presumed Profit||Aug/17||Feb/21||Jan/20|
|100%||São Paulo||602||52,7%||54||Presumed Profit||Aug/17||Aug/21||Dec/21||1Q19|
|Lot 1||100%||Santa Catarina||641||66,7%||38||Presumed Profit||Sep/18||Sep/23||Sep/214||N/A|
|Lot 10||100%||São Paulo||238||73,9%||10||Presumed Profit||Sep/18||Sep/22||Sep/214||N/A|
2 Conditioned to Lot 2 (Alupar)
3 To receive the totality of RAP
4 According to draft of concession contract
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ISA CTEEP and its wholly and jointly-owned subsidiaries invested R$ 136.7 million in 2Q18, 63.4% more than the amount reported for 2Q17. The variation is explained principally by:
(i) R$ 70.3 million invested in pre-operational subsidiaries as well as the payment for environmental licensing fees and land-related negotiations. Investments in the pre-operational subsidiaries are in line with the challenging budget and schedule that has been set. It is worth noting that the main investment flows of these subsidiaries will occur in the 3rd and 4th year of their respective construction periods;
(ii) R$ 45.0 million invested in reinforcements and improvements which generate additional revenue for the Company from organic growth. The investments in reinforcements and improvements are in line with the established budget. The investments are not comparable between periods since they involve distinct project portfolios and depend on the issuance of Authorization Resolutions by ANEEL; and,
(iii) R$ 21.4 million invested in operational subsidiaries. Growth of investments at the operational subsidiaries reflects mainly the additional CapEx at IE Madeira for the solution of pending issues.
In the first half of 2018, investments totaled R$ 234 million (+ 82.7% vs. 1H17).
|(BRL million)||2Q18||2Q17||Chg (%)||1H18||1H17||Chg (%)|
|ISA CTEEP (Reinforcements/Improvements)||45.0||52.2||-13.9%||64.5||94.7||-31.9%|
Updated on September 10, 2018.