Buyout firm Actis has reached an agreement with Gas Natural Fenosa to buy a group of companies focused on the transportation and supply of electricity in Guatemala. The deal is valued at $345 million, plus assumed debt. Actis focuses on emerging market deals, and has roughly $4.6 billion under management.
Actis, the pan-emerging markets private equity investor, has reached an agreement with GAS NATURAL FENOSA, a leading multinational in the gas and electricity sector, to acquire a group of companies dedicated to the transportation and supply of electricity to 1.4m customers in Guatemala in a transaction worth US$345m plus assumed debt.
The core of the business lies in its two electricity distribution and supply companies, DEOCSA and DEORSA; together these businesses supply electricity to 20 of the 22 departments in Guatemala, covering 94% of the land mass and serving the country’s large rural population.
GAS NATURAL FENOSA has built a strong, well-managed asset and Actis looks forward to working with the current management team to provide a first class customer service to its customers. Actis will draw on extensive investment experience gained in its management of Umeme, Uganda’s electricity distribution business, to further strengthen DEOCSA and DEORSA; expanding and investing in the network, connecting new customers and concentrating on loss reduction activities. Actis is looking forward to working closely with the Guatemalan authorities and communities in the years ahead to provide a continuous improvement in customer care and service quality.
Actis’s investment reflects its confidence in the potential of the energy sector in Central America. Guatemala has demonstrated the fastest sales growth in Central America since the privatisation of its distribution sector in 1998 with a CAGR of 6.6%. Actis is committed to the provision of safe, reliable electricity to support Guatemala’s continued economic growth.
Michael Till, Co-Head of the Energy Fund at Actis, said: “Through our investment we will continue to support Guatemala’s economic growth by providing the energy it needs. Actis looks forward to building upon the work of GAS NATURAL FENOSA and delivering a world-class service to customers while operating to the highest environmental, safety and governance standards.”
Since 1999 GAS NATURAL FENOSA has made an important contribution to the energy system of Guatemala. This investment has offered a stimulating challenge for it as an energy company and at the same time an opportunity for encouraging development, know-how and improvements. Throughout its involvement it has counted upon the support and understanding of the regulatory bodies and of the Guatemalan authorities. After this disposal of assets, GAS NATURAL FENOSA will continue to operate in the country via its telecommunications business Ufinet.
GAS NATURAL FENOSA maintains its commitment to Latin America, which currently accounts for more than 30% of group EBITDA. The company is still one of the principal energy operators in the region, present in a total of ten Latin American countries, with key positions in the region’s main markets. The energy multinational is involved in gas distribution in Argentina and Brazil, electricity and gas distribution in Colombia, and electricity generation and gas distribution in Mexico. In Puerto Rico, it is involved in electricity generation and operates a re-gasification plant; it also distributes electricity in Nicaragua, and generates and distributes electricity in Panama. GAS NATURAL FENOSA generates electricity in Costa Rica and the Dominican Republic and has a portfolio of wind projects in Chile.
Notes to editors
Actis invests exclusively in the emerging markets with a growing portfolio of investments in Asia, Africa and Latin America; it currently has US$4.6bn funds under management. Combining the expertise of over 100 investment professionals on the ground in nine countries, Actis identifies investment opportunities in three areas: private equity, energy and real estate.
In March 2011, Actis was named Latin American Private Equity Fund of the Year by PEI Magazine. Actis already has a strong presence in Central America as an investor in power generation developer, Globeleq and wind farm operator ERM.
Actis is proud to actively and positively grow the value of those companies in which it invests and in so doing contribute to broader society.
About Gas Natural Fenosa
GAS NATURAL FENOSA is one of the leading multinational companies in the gas and electricity sector, operating in 25 countries, with more than 20 million customers and 17.3 gigawatts of installed power.
Following the acquisition of the electricity company Union Fenosa, the third largest in the Spanish market, GAS NATURAL FENOSA has achieved its objective of integrating its gas and electricity businesses in a single company with extensive experience in the energy sector and the ability to compete more efficiently in global energy markets.
Today, GAS NATURAL FENOSA is the largest integrated gas and electricity company in Spain and Latin America, leading the natural gas sales market in the Iberian Peninsula; it is the number one distributor of natural gas in Latin America. With a fleet of 10 methane carriers it is also one of the biggest operators in the liquefied natural gas (‘LNG’) market in the world and is a company of reference in the Atlantic and Mediterranean basins where it supplies 30 billion cubic metres.