Eletropaulo

Electric distribution system serving Sao Paulo, 74.88% owned by Rio de Janeiro Light after a $1.8 billion bid. Light was taken over by a consortium including EDF and AES, which later bought out their partners and swapped shares so that EDF controls Light and AES controls Eletropaulo.

Eletropaulo serves 4.2 million customers and a total population of 14 million in a rapidly growing area of Brazil's largest city, a region that represents 16.5% of Brazil's total income.
(Houston/News98/brazil.htm)

Eletropaulo has served the Sao Paulo, Brazil area for over 100 years and is the largest electricity distribution company in Latin America in terms of revenues. Eletropaulos concession contract with the Brazilian National Electric Energy Agency (ANEEL), the government agency responsible for
regulating the Brazilian electric industry, entitles Eletropaulo to distribute electricity in its service area for 30 years. Eletropaulos service territory consists of 24 municipalities in the greater Sao Paulo metropolitan area and adjacent regions that account for approximately 15% of Brazils GDP, covering
5.0 million customers or 44% of the population in the State of Sao Paulo, Brazil.
AES began consolidating Eletropaulo in February 2002 when it acquired a controlling interest in Eletropaulo by exchanging a minority interest in another large utility, Light Servicos de Eletricidade S.A. (Light), for an additional 31% common equity interest in Eletropaulo. In January 2004, it
completed a restructuring of $1.3 billion (including interest) of indebtedness owed to the Brazilian National Development Bank, (BNDES). Pursuant to the restructuring, AES and BNDES created a new company, Brasiliana Energia S.A (Brasiliana Energia), to which AES contributed $90 million as well as its direct and indirect interests in Eletropaulo, Uruguaiana and Tiete. AES Sul may be contributed upon the successful completion of its financial restructuring. Pursuant to the shareholders agreement between AES and BNDES, AES controls Brasiliana Energia
through the ownership of a majority of the voting shares of the company. AES owns 50.01% of the common shares and BNDES owns 49.99% of the common shares plus non-voting preferred shares,
giving BNDES approximately 53.84% of the total equity capital of Brasiliana Energia. The
shareholders agreement requires that AES and BNDES act unanimously with respect to listed corporate events and actions. In return, Eletropaulos debt owed to BNDES was reduced to $510 million. (AES-AR2003.rtf)

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