Enel sells its distribution network assets in Peru to Chinese CSGI for $2.9 billion

Italian energy company Enel SpA announced today, April 7, that its Peruvian division is selling its energy distribution assets to China Southern Power Grid International (CSGI), a division of China Southern Power Grid Co. The transaction amount is $2.9 billion.

The agency was the first to report a possible sale of Enel’s Peruvian assets to a Chinese company. Bloomberg back in February. Then it was said that the Italian company intends to completely exit the Peruvian market. At the same time, it was said that the Chinese company, which had expressed a desire to buy energy distribution assets in Peru, did not intend to buy generating assets either.

In Peru, Enel reportedly serves over 1.5 million customers in 2021 put 8.44 GWh of electricity to the country’s market.

The deal is beneficial to both parties. Back in November last year, the Italian company presented a plan according to which, in order to reduce its debt (by the end of last year it was € 60 billion), it intends to part with some assets, mainly in Latin America and Europe. For a Chinese company, this means strengthening its position in Latin America, which has become an alternative growth region for Chinese companies in the face of increased control in Europe and the United States. So far, the Chinese company’s only asset in the region has been its 28 percent stake in Chilean energy company Transelec, acquired back in 2018.

Andrey Kelekeyev