Thursday , January 21 2021

AFP Cuprum and Habitat hire advice from Asset Chile to analyze the Enel Américas merger

More than two months ago, Enel Américas announced that it would initiate a merger process that would lead to the acquisition of renewable energy subsidiaries that Enel Green Power (EGP) owns in the region except Chile.

For this reason, AFPs are in the process of analyzing this transaction, but since a business of this size is not straightforward, two AFPs have also decided to outsource an external study: Habitat and Cuprum have contacted Asset Chile to advise on the operation and to learn about an internal study that each administrator will conduct.

The result of this advice will be a report that Asset Chile will provide to both AFPs possibly next week, competent sources say. The company already has experience in this matter; in fact, she was hired by Enel Generación Chile to issue the report in 2017 as the independent evaluators of the reorganization proposed by Enel Chile.

While some investors believe the deal is positive as it makes sense to combine renewable energy with traditional energy; For this board, one would expect a more in-depth analysis of operations, asset valuation and the post-trade composition of shares.

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The above, considering that the operation will lead to an increase in the Italian participation in Enel Américas, resulting in a change of regulations. All of this without having to submit a takeover bid, which would be another way to increase your share of the company.

This advice is in line with the fiduciary duty that AFPs must have, and with it they hope to get an informed opinion on the merger decision they will have to make at the December 18 shareholders’ meeting.

However, David Jana, employed by the board of directors of EGP Americas, estimated the value of the company’s assets to be between $ 6,053 million and $ 6,840 million. Meanwhile, Pablo D’Agliano estimated at $ 7.025 million. The Banchile (signed by the board of directors of Enel Américas) was estimated at $ 5.7–6.2 billion. And Santander, between $ 6,000 and $ 6,800 million.

The process that will be considered as a related party operation (OPR) is another of the various reorganisations carried out by the company, such as the splitting of the former Enersis into two parts, Enel Chile and Enel Américas; or the merger of Enel Chile with Enel Green Power Chile, both arousing controversy among investors, which took place in 2016 and 2018.

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