Equatorial Secures Strategic Stake in Copasa Privatization

Equatorial has cemented its position as the lead investor in the privatization of Brazilian utility giant Copasa, acquiring a 30% stake for 5.59 billion reais. The move marks a definitive shift for the firm, which now aims to control a utility infrastructure serving 12 million people across Minas Gerais.

The Brazilian power company secured the bid at 49.03 reais per share, successfully navigating a process that saw competitors, including the Aegea consortium, withdraw before the final deadline. This acquisition follows a state-led initiative to transfer control of the utility to the private sector, building on a share offering that launched in May with an initial valuation exceeding $1 billion.

Minas Gerais maintains a majority position with over 50% of the company, but the government intends to sell an additional 20% to the broader market. Pricing for this secondary tranche is slated for June 11. For Equatorial, the strategy extends beyond the initial purchase; the company is eyeing an additional 48 million shares. Should this secondary acquisition materialize, the firm's total investment in the utility could climb to 7.9 billion reais, further entrenching its dominance in the sanitation sector following its recent expansion in Sao Paulo.