Tag Archives: Brazil and China relations

hydroelectric power

China to pay Brazil $3.7 Bn to Run Hydroelectric Power Plants

A state-owned power company, China Three Gorges, agreed on Wednesday to pay Brazil’s federal government 13.8 billion reais, or $3.7 billion, for the rights to operate two massive hydroelectric power plants for the next 30 years.

China Three Gorges made the commitment during a government auction of 29 operational power plants whose concession contracts have expired.

The $3.7 billion payment to operate the plants was fixed. The auction’s winner was the company that promised, after paying that sum, to sell electricity to consumers at the lowest price, but China Three Gorges was the only company to bid on these two plants. “There weren’t other bidders because of the way the government organized the auction,” said Claudio Sales, president of Instituto Acende Brasil, an electricity sector think tank in São Paulo. “Fully operational hydroelectric plants with consumer contracts are attractive assets.”

source NY times

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BOCOM in Brazil

China’s BOCOM Seals Deal for Brazil’s Banco BBM

China’s Bank of Communications (BOCOM), the country’s fifth-largest commercial bank by assets, has agreed to buy a controlling stake in Brazil’s Banco BBM, the latest in a string of overseas acquisitions by Chinese banks and brokerages.

BOCOM said it would pay R$525m ($173m) in cash for an 80 per cent stake in unlisted Banco BBM, based on the bank’s book value of R$576m. BOCOM had assets totalling $1.1tn at the end of March.

Although it is the first overseas acquisition for BOCOM, Chinese financial institutions are not opposed to snapping up assets abroad, having spent a total of $4.8bn on 30 overseas deals in 2014, following $5.1bn in deals in 2013.

Most have aimed at positioning Chinese lenders to service Chinese corporate clients overseas. China is Brazil’s largest trading partner and a major importer of Brazilian soy-beans and iron ore.

The Bocom deal came as Li Keqiang, Chinese premier, met with Brazil’s President Dilma Rousseff as part of a tour of Brazil, Colombia, Peru and Chile. At a joint press conference, Mr Li and Ms Rousseff announced more than $53bn worth of trade and investment between the two countries.

Source: Wall Street Journal

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