The company is exiting the Latin American market to focus on its domestic regulated business, which was further bolstered by the acquisition of Piedmont Natural Gas.
Duke Energy announced the sale of its Brazil assets to China Three Gorges Corp. and the sale of its remaining Latin American assets – in Peru, Chile, Ecuador, Guatemala, El Salvador and Argentina – to I Squared Capital in Oct. 2016. The I Squared Capital sale was completed on Dec. 20, 2016.
“Today marks a significant milestone in the strategic transformation of our company,” said Duke Energy chairman, president and CEO Lynn Good. “We completed these transactions ahead of schedule and are now fully focused on growing our regulated businesses in 2017 and beyond, including the natural gas platform.”
The transactions with China Three Gorges Corp. and I Squared Capital are expected to generate available cash proceeds of nearly $1.9 billion, excluding transaction costs and subject to working capital adjustments, which will be used to reduce Duke Energy holding company debt. Existing federal tax attributes will result in no immediate U.S. tax impacts.
China Three Gorges Corp. is acquiring Duke Energy assets consisting of 10 hydroelectric generation plants – eight plants totaling 2,057 MW on the border between Sao Paulo and Parana states; and two plants totaling 33 MW on the Sapucai Mirim River in Sao Paulo state.
Duke Energy’s 25 percent equity investment in National Methanol Company — a Saudi Arabian regional producer of methanol and methyl tertiary butyl ether (MTBE), a gasoline additive — is not included in the sales to China Three Gorges Corp. and I Squared Capital.