February 28 (Renewables Now) - The Chile-based unit of Italian renewables-focused utility Enel SpA (BIT:ENEL) is looking to raise up to USD 3.5 billion (EUR 3.07bn) through a capital hike and has called an extraordinary meeting for shareholders to approve the move.
Enel, which holds a 51.8% stake in the unit called Enel Americas SA (NYSE:ENIA), announced today that the particular meeting is scheduled for April 30, 2019. The Italian company noted that its board of directors is yet to assess how it would participate in this capital increase.
The transaction is expected to involve the issue of new ordinary shares and new American Depositary Shares (ADSs). Its purpose is to bolster the financial position of the Chilean business so it could pursue new opportunities for organic and inorganic growth, optimise cash flows and improve its debt level. Enel noted that its majority-owned unit could carry out both minority buyouts and merger and acquisition (M&A) deals.
At the same time, the capital raise will enable an increase of the free float and capitalisation of Enel Americas.
The Chile-based subsidiary has more than 11 GW of installed capacity and invests in electricity generation and distribution in Argentina, Brazil, Colombia and Peru. It serves over 24 million customers.
(USD 1.0 = EUR 0.878)