Germans Increase MPX Stake

Germany’s E.ON has agreed to pay at least BRL1.78bn ($886m) to increase its stake in Brazil’s MPX, MPX says, through a direct purchase of shares from controller Eike Batista and participation in a planned equity follow-on. Batista has agreed to sell 142m shares, or 24.5%, of the power generation company to E.ON, at BRL10.00 each, a price adjustable to as much as BRL11.00 each depending on certain conditions. The move takes E.ON to a 36.2% position. MPX plans to follow this with a public follow-on sale of primary shares, in which E.ON has committed to exercise its rights for at least BRL367m, at the same BRL10.00 per share price. BTG Pactual has been hired to manage the sale, for which the timing remains to be set. MPX and E.ON have signed a shareholder agreement establishing E.ON’s voting rights. The two parties’ existing joint venture is also to be folded back into MPX.