judicial recovery plan - amended version (version 1)

Download Judicial Recovery Plan - Amended Version (Version 1)

Post on 21-Dec-2015

40 views

Category:

Documents

3 download

Embed Size (px)

TRANSCRIPT

  • 1

    PLAN FOR COURT-SUPERVISED REORGANIZATION

    OF ENEVA S.A. UNDER COURT-SUPERVISED REORGANIZATION

    AND

    ENEVA PARTICIPAES S.A. UNDER COURT-SUPERVISED REORGANIZATION

    ENEVA S.A. under Court-Supervised Reorganization, a corporation with head

    offices at Praia do Flamengo, n 66, 9 andar, Flamengo, Rio de Janeiro/RJ, CEP n

    22.210-903, registered under Corporate Taxpayer Number (CNPJ n)

    04.423.567/0001-21, and ENEVA PARTICIPAES S.A. under Court-

    Supervised Reorganization, a corporation with head offices at Praia do

    Flamengo, n 66, Room 901 parte, Flamengo, Rio de Janeiro/RJ, CEP 22.210-903,

    registered under Corporate Taxpayer Number (CNPJ n) 15.379.168/0001-27,

    hereafter referred to individually and respectively as Eneva and Eneva

    Participaes, or jointly as Companies Under Court-Supervised Reorganization,

    present in the records of the court-supervised reorganization process, registered

    under n 0474961-48.2014.8.19.0001, currently pending before the 4th

    Commercial Court of the Capital of the State of Rio de Janeiro, the following plan

    for court-supervised reorganization, in compliance with the provision of article 53

    of the LRJ (Court-Supervised Reorganization Law).

    1. INTRODUCTION

    1.1. Background. Eneva was formed in 2001, under the name MPX Energia S.A.,

    to operate with a focus on the generation and commercialization of energy,

    possessing complementary businesses in electrical generation, coal mining and the

    exploration and production of natural gas in Brazil and in other countries of South

    America.

    The company was the operational arm of the EBX Group in the energy generation

    and commercialization sector, and is currently the largest private generator of

    thermal energy in Brazil.

    In the context of a highly favorable economic scenario, as a means of capitalizing in

    order to develop its projects and obtain new sources of funding, in December 2007

    Eneva held a public share offering (IPO) in the New Market sector of the BM&F

    BOVESPA stock exchange, embarking on a new phase in Eneva's relationship with

    its shareholders and investors. Around one month later, the option for the

    subscription of a supplementary batch of ordinary shares granted to the

    coordinating banks was exercised. As a result of these two operations,

    approximately R$2 billion of funds were raised with new shareholders..

  • 2

    Spurred by the new investments, Eneva did not simply continue to pursue projects

    currently underway but embarked on the execution of other projects in the energy

    sector, both inside and outside Brazil - such as the Pecm II Thermoelectric Power

    Plant (Cear), the construction of Thermoelectric Power Plants in the Parnaba

    Basin (Maranho), the largest thermal energy generation project in Chile

    (Termoelectrica Castilla) and the extraction of coal in Colombia.

    In order to obtain new sources of funding, from 2009 the Eneva Group contracted

    short-, medium- and long-term loans with financial institutions and development

    banks, for the development of new projects and the expansion of existing ventures.

    In 2011, through the issuance of bonds convertible into common shares, Eneva

    also raised funds with BNDES Participaes S.A. BNDESPar, Gvea Investimentos

    and their then controller, Mr. Eike Batista, in the sum total of approximately R$1.4

    billion, to be used on a priority basis to expand the exploration of natural gas in the

    Parnaba Basin in the state of Maranho, which process began the following year,

    and in the extraction of coal in Colombia. In the middle of 2012, 99.9% of these

    bonds were converted into shares in Eneva and the coal operations in Colombia

    were spun-off to a new company called CCX Carvo da Colmbia S.A., in which

    Eneva did not possess a stake.

    It is important to highlight that these funding measures, and those which

    succeeded them in the following years, were assumed under wholly normal market

    conditions and at leverage levels which were compatible with the evaluation of

    each project by the funders.

    In August of 2011, ANEEL approved the transference of the authorizations of the

    Parnaba I TPP from Bertin Energia e Participaes S.A. to Eneva, relating to energy

    projects contracted at the A-5 auction of 2008, totaling 450 average MW. The

    fourth and fifth turbine of this TPP received authorization to begin commercial

    operations on 12.04.2013, proceeding to generate 676 MW, the projects having

    been financed by the Brazilian Bank of Social and Economic Development (Banco

    Nacional de Desenvolvimento Econmico e Social - BNDES) in the approximate sum

    of R$671 million.

    Also in 2011, the Parnaba II TPP, with a capacity of 517 MW, was victorious at the

    A-3 new energy auction and, in April 2013, Eneva informed the market that it had

    concluded the acquisition of the total stockholders' capital of Parnaba III

    (formerly UTE MC2 Nova Vencia), consolidating the Parnaiba Complex as the

  • 3

    largest gas to wire project in Brazil, where the power plants are strategically

    located over the gas fields and under the transmission lines.

    At the start of 2012, Eneva announced its intention to form a joint venture with the

    E.ON Group, one of the largest private energy and gas groups in the world. The aim

    was simple and clear: the companies could exploit their complementary activities

    and characteristics to accelerate the growth and development of a comprehensive

    energy project in Brazil.

    Thus, in April 2012, the definitive documents of this operation were signed, by

    which Eneva raised R$1 billion through an increase in subscribed capital by DD

    Brazil Holdings S..r.l., an investment vehicle controlled by the German company

    E.ON SE, which holds interests in the companies of the Eneva Group, the object of

    the investment. Following this increase, E.ON attained an interest of 11.75 in

    Eneva. On 17.04.2012, Eneva signed the definitive agreements for the formation of

    a joint venture with E.ON, which was concluded on 25.05.2012, in the form of the

    company Eneva Participaes S.A, which is also under court-supervised

    reorganization.

    The structure of Eneva Participaes was conceived with the aim of optimizing the

    complementarities of the two groups. According to the expectations shared by

    both, this partnership could lead to the efficient development, execution and

    operation of energy generating projects with a total capacity of 20 GW, including

    thermal and renewable generation. The management of Eneva Participaes

    combines high profile and experienced international executives from E.ON and a

    group of executives from Eneva with a profound knowledge of the Brazilian

    electrical sector.

    In May 2013, following the verification or waiver of all the precedent conditions

    foreseen in an investment accord signed months previously, E.ON acquired

    141,544,637 shares issued by Eneva and held by Mr. Eike Batista and by certain

    shareholders, who held share options, representing 24.47% of its capital. As a

    result of this operation, E.ON proceeded to hold approximately 38% of Eneva's

    capital, having signed a Shareholders' Agreement with Mr. Eike Batista to exercise

    shared control. Moreover, on May 12th 2014, the implementation of an increase of

    private capital was announced, regarding Eneva, in the value of up to

    R$1,500,000.00 (one billion, five hundred million reais). The price per share

    regarding this increase was fixed at R$1.27 (one real and twenty seven cents), as

    approved by Enevas board of directors. E.ON undertook to subscribe part of the

    shares, in the limited sum of R$120,000,000.00 (one hundred and twenty million

  • 4

    reais). As a result of the share subscription by E.ON, the latter proceeded to hold

    approximately 42% of Enevas capital and, furthermore, to share control with Mr.

    Eike Batista.

    Eneva has always sought to pursue economically viable projects, with a view to

    ensuring the highest standards of efficiency - in a creative and innovative manner,

    supported by cutting-edge technology - without neglecting its socio-environmental

    commitments.

    Moreover, it possesses a team of associates who are highly trained and whose

    record is distinguished by the capacity to integrate activities, eliminating

    production costs, signing and respecting partnerships and identifying good

    business opportunities.

    Eneva operates under the highest standards of corporate governance, and is listed

    on the New Market of the BM&F BOVESPA stock exchange, which, in itself,

    indicates that its operations are characterized by outstanding levels of

    management. Each of the company's actions is and always has been

    profoundly and broadly disclosed to the market with the maximum transparency.

    It was in this manner that, in a short time, the Eneva Group emerged in the market

    as one of the most important companies in the energy sector, principally as the

    largest private company in the thermal generation sector, whose growth is so

    essential to Brazil within a secure energy matrix, as has been made clear by recent

    events. If, on the one hand, recent events concerning atypically low rainfall levels

    underlined the importance of Eneva, as well as of the generation of thermal en