China Three Gorges leads bids for RM4b hydro plant

SAO PAULO • China Three Gorges Corp, a state-owned electricity producer, has emerged as the leading bidder for Odebrecht SA’s Chaglla hydropower plant in Peru, according to people with knowledge of the matter.

Odebrecht aims to reach a deal with the Beijing-based company in the next few weeks on the sale of the 456MW power plant, the people said, asking not to be identified because the information is private. A deal could value the project at more than US$1 billion (RM4.29 billion) including debt, the people said.

At least one other bidder remains engaged in the process, and there’s no certainty that China Three Gorges will reach a final agreement on terms of a transaction, another person said.

The country’s largest hydropower operator, China Three Gorges has been acquiring projects overseas as the government encourages renewable energy investments. It agreed last year to buy Duke Energy Corp’s Brazilian plants for about US$1.2 billion, followed by a deal in February to buy 49% of a portfolio of wind assets from EDP Renovaveis SA.

Any deal would add to the US$7.4 billion of Chinese acquisitions announced in Latin America and the Caribbean this year, up from US$5.3 billion during the same period in 2016, according to data compiled by Bloomberg.

Odebrecht’s Latin America infrastructure-investment unit, Odebrecht Latinvest, put Chaglla up for sale last year shortly after it started operations. — Bloomberg