March 12 (Bloomberg) -- CPFL Energias Renovaveis SA, the Brazilian joint venture of CPFL Energia SA and ERSA-Energias Renovaveis SA, will buy a cogeneration plant at a sugar-cane mill for 111.5 million reais ($61.2 million) as it seeks to expand its lead as the country’s largest producer of power from renewable sources.
The company will pay 50.9 million reais to the sugar and ethanol producer Usina Acucareira Ester SA and assume 60.6 million reais of debt for the plant, CPFL Energias Renovaveis said today in a statement.
CPFL Energias Renovaveis is “the biggest producer of renewable energy,” in Brazil, Rafael Dias, an analyst with Brasilia-based lender Banco do Brasil SA, said today in a telephone interview. “Its intention is to consolidate this position.”
The company expects to operate 2,000 megawatts of renewable energy capacity by 2015. It may sell shares in an initial public offering on Brazil’s stock exchange Bovespa this year to fund further expansion, Chief Executive Officer Miguel Saad said in a Feb. 27 telephone interview.
CPFL Energias Ronovaveis’s board authorized the Sao Paulo-based company to hire investment banks to study an IPO, according to a regulatory filing today.
The Ester plant, in the city of Cosmopolis in Sao Paulo state, burns crushed cane stalks known as bagasse to produce steam and electricity. It sold power for about 177 reais a megawatt hour in a 2007 government-organized auction, according to the statement. The purchase must be approved by Brazil’s electricity regulator Agencia Nacional de Energia Eletrica.
CPFL Energias Renovaveis operates 809.5 megawatts of renewable energy capacity, including three biomass plants with total capacity of 175 megawatts. It may develop four more with 195 megawatts of capacity by next year, the company said.
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