Upward debut for Iberdrola’s subsidiary in Brazil: Neoenergia rises 2.3% in its debut at Latibex | Economy | The USA Print

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Directors of the Brazilian subsidiary of Iberdrola, Neoenergia, this Tuesday at the Madrid Stock Exchange.
Directors of the Brazilian subsidiary of Iberdrola, Neoenergia, this Tuesday at the Madrid Stock Exchange.ALTEA FABRIC (EFE)

Neoenergia, the Brazilian subsidiary of Iberdrola, opened this Tuesday with increases in the Latibex, the index dedicated to Latin American securities and operated by the Spanish Stock Exchanges and Markets (BME). In its stock market debut in Spain, its shares have advanced by 2.29%, to 3.57 euros. The company, one of the main players in the Brazilian electricity market, thus intends to attract investors from this side of the Atlantic, who are “long-term and stable.”

This has been pointed out by Fernando Capelastegui, director of Neoenergia and future CEO of the same, who has assured that the entry of the company in the Latibex represents “a channel that opens the door” to European and Spanish investors. “We have investments of 5,000 million per year. It is organic, permanent growth”, he said in statements to the press after the traditional ringing of the bell at the Palacio de la Bolsa in Madrid.

The manager has assured that the regulation in Brazil is clear and the Government’s commitment to renewables is firm. “Our investments are long-term, 20-30 years, with stable regulation. They are low risk investments. we are not one telecowe are not one start-up, we are a group that works in a regulated market with a stable and very well defined regulation. I think Brazil is an example in this sense”, he added. “We have a well-defined dividend policy, and therefore our desire is to attract this type of shareholder: long-term, stable, who are with us.”

Diversified business

Neoenergia has been operating in Brazil since 1997, where it is present in 18 of the country’s 26 states. Since 2019, it has been listed on the São Paulo Stock Exchange, after merging with Elektro, also owned by Iberdrola. With a capitalization of more than 4,260 million, nearly 700,000 kilometers of power lines and 5,200 megawatts installed – 80% are green -, it is one of the main players in the Brazilian electricity sector, with a market share of 18%.

Its business is divided into four areas: generation, transmission, distribution and marketing. It has five distributors and serves more than 15 million customers in Brazil. Iberdrola controls 53.5% of the company. Its second largest shareholder is the insurance company Previ (30.3%), the largest pension fund in Latin America, while the free-float accounts for the remaining 16.2%.

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The current CEO of the firm and next CEO of Iberdrola Spain, Mario Ruiz-Tagle, has made the traditional bell ringing and has indicated that the jump to the Spanish index is the best way to increase the investor base in Europe. The Brazilian company is the nineteenth company listed on the Latibex and the twelfth from Brazil. The manager underlined that Neoenergia offers a diversified portfolio of projects, focused on growth, efficiency and profitability, a stable regulatory framework and the experience of the Iberdrola group, among other advantages.

Since January 2021, it has been part of the portfolio of the Corporate Sustainability Index B3 ―Brazil, Stock Exchange, Balcão―, which brings together the companies that have the best governance and corporate sustainability practices.

The managing director of Latibex, Jesús González Nieto, accompanied Ruiz-Tagle at the firm’s stock market debut and emphasized the “innumerable ties” between the two sides of the Atlantic, underlining the importance of incorporating a company like Neoenergy to index. “Latibex was launched in 1999 for investors to invest in sister companies in Latin America directly in euros. This year it has had an excellent revaluation, of almost 30%, not insignificant given this context of uncertainty”, he pointed out.

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