Lisbon, Portugal — ESI-AFRICA.COM — 04 January 2012 – The China Three Gorges Corporation has won the race for privatisation of Portuguese power company Energias de Portugal (EDP), winning the tender to acquire the 21.35% stake in the company for US$3.5 billion.
Revealing this here, a statement filed with Portuguese stock market regulator CMVM added that the other companies in the running to buy the stake had been Germany’s E.On and Brazilian companies Eletrobras and Cemig.
The Chinese company offered to pay the highest overall amount for the stake in EDP “’ US$3.5 billion for the state’s shares, as well as funding of US$5.2 billion for EDP’s business activities. The price paid represents a premium of 53.6% against the stock market price on 21 December.
The strategy of the China Three Gorges Corporation will be to use the Portuguese power company to access the European, North American and Brazilian markets.
Three Gorges also said that it planned to build a wind turbine factory in Portugal, generating around US$650 million of exports per year and serving as a bridge for EDP to receive financing from Hong Kong.
The company guarantees US$2.6 billion of funding to EDP, and another potential US$2.6 billion, and is interested in buying shares in EDP’s wind power assets.
The Portuguese government also said that total investment in EDP and the Portuguese economy may total US$10.4 billion if funding by Chinese banks is taken into account.
The China Three Gorges Corporation, with headquarters in Hubei province, was founded in 1993 as part of construction of the Three Gorges Dam on the Yangtze River, which involved not only construction of the world’s largest dam, but also a series of power plants along what is Asia’s longest river at 6,418km.