Renova Energia SA (RNEW11), the Brazilian renewable-energy developer that built the largest wind farm in Latin America, may sell bonds tied to infrastructure in Brazil’s local markets as it seeks to finance 1.5 billion reais ($740 million) in new wind-power projects this year.
Renova has plans to build 400 megawatts to 500 megawatts annually and expects to close on contracts for the free electricity market by the end of 2013, said Pedro Pileggi, the company’s director of investor relations.
The bonds are part of the government’s push to create a debt market for infrastructure projects. They are designed to attract foreign investors, and could help relieve “financing bottlenecks,” Pileggi said in an interview today in Sao Paulo.
In addition, the bonds may offer long-term financing of 12 to 14 years, Pileggi said.
“This is what we are hoping for,” Pileggi said, adding that the company has received the bulk of its financing from Banco Nacional de Desenvolvimento Economico e Social, Brazil’s national development bank. “BNDES will continue being extremely important, but some kind of capital market instrument has to continue for the entire sector to succeed.”
Renova’s shares have more than doubled since the company’s initial public offering on July 13, 2010, compared with a 2.5 percent decline for the Bovespa benchmark index. Renova fell 1.2 percent to 31.63 reais today.
It has already contracted more than 1.1 gigawatts of wind power on the Brazilian electricity market, of which 400 megawatts is being built for Renova shareholder Light (LIGT3) via the free market.
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