Iberdrola, a leading global energy company, plans to increase its stake in Brazilian utility Neoenergia to 84% through a significant acquisition from Caixa de Previdência dos Funcionários do Banco do Brasil (PREVI). This strategic move is just one of Iberdrola’s continuing efforts to build its portfolio and presence in Brazil’s rapidly growing energy sector. The transaction is valued at around $2.2 billion. It is assumed to free up Iberdrola’s operations and investments in Brazil, a key market for the Spanish company.
For Iberdrola, that means acquiring an additional 30.29% stake in Neoenergia at a price of €15.15 per share. This transaction is the largest such accelerated bookbuilding exercise in Spain since Santander raised €7.5 billion in 2015. The cashless accelerated bookbuilding process took off. Moreover, it was 3.8 times oversubscribed, proof of the confidence investors have in Iberdrola’s growth strategy.
Investment and Infrastructure Development
Neoenergia stands out as a pivotal player in Brazil’s energy sector, having invested over 9.8 billion reais in the country’s basic infrastructure during 2024. This investment marks a key milestone in the company’s plan to improve energy distribution and reliability throughout Brazil. Iberdrola has already increased its ownership in Neoenergia. This step aligns with its long-term ambitions to strengthen its control over energy distribution and transmission nationwide.
Back in July, Iberdrola had already mobilised €5 billion of capital. This funding will help backfill their investments in advanced grid infrastructure across the U.S. and U.K. The company’s acquisition of Neoenergia will further solidify its position in Latin America, complementing its existing network that includes five distribution companies and 18 transmission lines across various states.
Regulatory Approval and Future Prospects
That agreement between Iberdrola and PREVI still awaits regulatory approval, with closing expected in the next few months. Iberdrola will massively reinforce its position in Brazil. It now operates a sprawling network of 870,000 miles (1,400,000 km) of transmission lines across four continents, including the U.S., the United Kingdom, Brazil and Spain.
Iberdrola’s ambitious plans are a testament to its commitment to renewable energy and sustainable development. We’re raising our investment in Neoenergia. This strategic move will allow it to capitalize on Brazil’s rapidly expanding energy demand while furthering the government’s agenda of infrastructure modernization.
