Brazilian steel producer Gerdau plans to acquire two hydropower plants from renewable energy company Atiaia Energia.
Gerdau is purchasing all the shares in the vehicles that control two small hydropower plants, each with a 29-MW capacity, for around $73.2 million, to be paid in cash.
The payment is subject to adjustments based on the levels of cash and debt to be determined on the closing date, according to a company filing.
The renewable energy assets, Garganta da Jararaca and Paranatinga II are located in Mato Grosso state. Their outputs will meet approximately 8% of the energy consumption of Gerdau's steel production units in Brazil.
Gerdau noted the closing of this transaction is also pending the verification of the usual conditions precedent, such as the approval from the Brazilian competition regulator CADE.
Last September, Gerdau agreed to pay around $60 million to acquire a recycling business in the US in order to secure more steel scrap for its production processes.
Source: Renewables Now