the British rurelec decided to end a long foray into Argentina and sell his stake in the Generator Patagonia thermoelectric plant, property of Southern energy. For half of a plant that has a power of 138 Mw and is the largest in that region, you will receive only 5 million dollars.
The company had long been trying to leave the country. About ten years ago he had suffered the expropriation of a generator in Bolivia and the group had ended up being managed by a holding company that only had Argentine assets in the energy sector.
The purchaser of the plant located in Comodoro Rivadavia, Chubut, is an eclectic bunch. It is led by Rolando Gonzalez Bunsteran Argentine resident in the Dominican Republic, owner of the Interenergy holding, valued at 1.5 billion dollars, which already owned 50% of Energía del Sur.
It is now joined by the Verafont company, by a group led by Venezuelan Miguel Mendoza, a former Ashmore and fleeting former owner of the Eden and Edes power companies. And also Esteban ReynalArgentinian businessman who knew how to be owner of the newspaper La Prensa in the early 90s.
“N”or is it a good deal”, says Benjamín Reynal, son of Esteban and current CEO of Energía del Sur (EdS). And about the British, he comments on it “They contributed nothing. They always needed money because they were broke.”
The thermal power plant debacle started two years ago. Until then, they had a contract that set a dollar value for the energy sold. “But that contract has expired and our billing decreased by 70%“, he explains. Hence the “low” price of the sale: “It’s the same as changing a rotor”, compares Reynal, who in addition to being a businessman is a volunteer firefighter in BarilocheWhere do you live, and writer.
Despite the drop in revenues, the executive states that the plant is maintained and that it is indispensable in the Comodoro Rivadavia area, even if several wind farms have sprung up in recent years which, like EdS before, have contracts in dollars. “Today, we get the equivalent of $10 per megabyte, while some wind farms go as high as $120,” he says.
Reynal says Cammesa pays all generators the same across the country, but that EdS has, for example, higher labor costs in the area. and that the the tariff increases foreseen for this year are not enough.
To convince its shareholders that the best alternative is to sell, Rurelec informed them Difficult times are coming for Energía del Sur and that the company must maintain its cash, which is why it will not distribute dividends.
Among the setbacks that the Argentine company will face, Rurelec points out that it is likely that payments due from Cammesa, the administrator of the national electricity service, will continue to be delayed. Besides the fact that it may be difficult for him to get funds for maintenance.
At the macro level, they warn of the lingering crisis, the exchange rate gap and a possible decline in activity that could reduce electricity demand.
“Political uncertainty makes it difficult or impossible to predict what position the future government will take on raising tariffs,” say the British.
But Argentine buyers are just waiting for the change of president. “The bet is on another governmentReynolds admits.
Exodus of international companies
Rurelec’s exit is different from other large multinationals because it is a company that is exiting the business itself worldwide.
But there have been other recent instances where global companies have made up their minds remove Argentina from its budgets, either directly by selling or closing your local business, or by leaving your brand in the hands of a distributor.
In the first case, for example, the investment bank Lazard stands out, which will close its offices in Argentina, Chile, Colombia and Panama. Or the dairy giant Lactalis, which has decided to close everything in Argentina and focus on Brazil for now.
Are also that they sellsuch as Walmart, which has sold its business to the De Narváez group, or the Italian Enel, which has already decommissioned the Costanera and Dock Sud power plants and is looking for a buyer for Edesur.
And finally, there is a third group that have left their brands in the hands of third partiessuch as Nike, Asics, Edding or Shell.
Charles Arterburn is a seasoned business journalist for News Rebeat, where he provides comprehensive coverage of the latest trends and developments in the world of finance and economics.