Abengoa Yield Said to Work With JPMorgan on Stake Sale Plans

  • Abengoa SA may sell part or all of its 47 percent holding
  • Process is at preliminary stage, could draw energy investors

Abengoa Yield Plc, the power plant operator created by Spanish energy firm Abengoa SA, is working with JPMorgan Chase & Co. as it seeks a buyer for its parent company’s stake, according to people with knowledge of the matter.

Abengoa Yield is looking for a buyer for part or all of the 47 percent holding, which may attract interest from other companies in the renewable energy sector, the people said, asking not to be identified because the name of the bank isn’t public yet. The process is still at a preliminary stage, the people said.

Abengoa Yield wants to find a long-term investor to guarantee its sustainability as an independent business after its parent company filed for preliminary protection from creditors. It has mandated a top-tier investment bank to lead the search for a new sponsor, according to a statement Friday. It’s also working on new branding and hiring a new chief financial officer from outside the company.

A representative for Abengoa Yield and Abengoa declined to comment. A representative for JPMorgan couldn’t immediately comment.

Abengoa is struggling under about 8.9 billion euros ($9.4 billion) of debt. Shareholders last month approved a plan to reduce leverage, which includes a potential sale of some or all of its “economic rights in Abengoa Yield,” according to a U.S. regulatory filing.

Abengoa Yield was formed as a so-called yieldco, a holding company to buy and operate its power plants, and it held an initial public offering in the U.S. in June 2014. It operates solar and wind farms, desalination plants, transmission lines and conventional power plants in eight countries on four continents. Those assets will provide steady revenue streams for years to come, making Abengoa’s stake attractive to buyers.

Abengoa’s Chief Executive Officer Santiago Seage stepped down Friday after six months on the job, part of a management reorganization. Seage, who also resigned from the board, will focus on his role as managing director of Abengoa Yield, the company said in a regulatory filing.

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