China Three Gorges’ $1.39 Billion Acquisition of Empresa de Generación Huallaga S.A.

Sullivan & Cromwell, Muñiz, Olaya, Meléndez, Castro, Ono & Herrera, EY – Perú, Miranda & Amado, Allen & Overy, Hernández & Cía. and Rodrigo, Elías & Medrano advised on the transaction.

China Three Gorges (CTG), a Chinese state-owned power company, completed its $1.39 billion acquisition of Empresa de Generación Huallaga S.A. on April 25. Formerly a subsidiary of Brazilian construction multinational Odebrecht SA, EGH was responsible for developing Peru’s Chaglla hydroelectric power plant. Because EGH owns the permanent concession of the Chaglla plant, the deal effectively gives the CTG-led consortium ownership of the plant, which is the third-largest hydropower facility in Peru. To finance the purchase, Bank of China Limited, Luxembourg Branch, amongst others, provided the consortium with an $850 million two-year bridge loan and letter of credit facility.

This acquisition is China Three Gorges’ first purchase in Peru, as the presence of Chinese energy companies continues to grow in Latin America. The Chaglla plant’s installed capacity of 456,000 kilowatts accounts for approximately five percent of the total energy generated in Peru. The plant’s location in the country’s northern Andean mountain region makes it a critical supply of power for Peru’s mining industry.

Sullivan & Cromwell advised Chaglla Holdings Limited the CTG-led consortium with a team including Sergio Galvis (Picture), Werner Ahlers, Chun Wei. Partners Jamie Logie, Garth Bray and Kay Ian Ng in Hong Kong advised on financing matters, including securing the bridge loan and credit facility.

In Perù, Muñiz, Olaya, Meléndez, Castro, Ono & Herrera advised CTG with Andrés Kuan-Veng Cabrejo, Jorge Otoya Cabrera and Guillermo Flores Borda.

EY – Perú advised CTG with Fernando Tori Vargas, Claudia Plasencia and Edwin Sarmiento.

Miranda & Amado advised Odebrecht with Luis Marcelo De Bernardis Llosa, Gabriela Dañino Sinclair and Lisbeth Benavides Kolind Hansen.

Allen & Overy advised Bank of China Limited with Bruno Soares, Yvonne Ho, Patrick Mischo, David Lucking, Mark Manisty, Julie Carbiener, Shanthi Maria Vignasen, Andre Teixeira, Eduardo Kappel, Violet Jia, Chris Jung, Kuda Chirambadoro, Inhong Kim and Helen Gu.

Hernández & Cía. advised Bank of China Limited with Brendan Oviedo Doyle, José Goyburu, Gloria Zubizarreta, Maria Alejandra Justo, Daniela Falcone and Andrea Limón.

Rodrigo, Elías & Medrano advised Banco Interamericano de Desarrollo, BNDES and Deutsche Bank with Juan Diego De Vinatea and Efraín Salazar.

Involved fees earner: Julie Carbiener – Allen & Overy; Kuda Chirambadoro – Allen & Overy; Yvonne Ho – Allen & Overy; Chris Jung – Allen & Overy; Eduardo Kappel – Allen & Overy; Inhong Kim – Allen & Overy; David Lucking – Allen & Overy; Mark Manisty – Allen & Overy; Patrick Mischo – Allen & Overy; Bruno Soares – Allen & Overy; Andre Teixeira – Allen & Overy; Shanthi Maria Vignasen – Allen & Overy; Violet Jia – Allen & Overy; Fernando Tori Vargas – EY Law; Daniela Falcone – Hernández & Cía Abogados; José Goyburu – Hernández & Cía Abogados; María Alejandra Justo – Hernández & Cía Abogados; Andrea Limón – Hernández & Cía Abogados; Brendan Oviedo – Hernández & Cía Abogados; Gloria Zubizarreta – Hernández & Cía Abogados; Lisbeth Benavides – Miranda & Amado Abogados; Gabriela Dañino Sinclair – Miranda & Amado Abogados; Luis Marcelo de Bernardis Llosa – Miranda & Amado Abogados; Guillermo Flores Borda – Muñiz, Olaya, Meléndez, Castro, Ono & Herrera; Andrés Kuan-Veng Cabrejo – Muñiz, Olaya, Meléndez, Castro, Ono & Herrera; Jorge Otoya Cabrera – Muñiz, Olaya, Meléndez, Castro, Ono & Herrera; Juan Diego De Vinatea – Rodrigo, Elías & Medrano Abogados; Efraín Salazar – Rodrigo, Elías & Medrano Abogados; Werner Ahlers – Sullivan & Cromwell; Garth Bray – Sullivan & Cromwell; Sergio Galvis – Sullivan & Cromwell; Jamieson Logie – Sullivan & Cromwell; Kay Ian Ng – Sullivan & Cromwell; Chun Wei – Sullivan & Cromwell;

Law Firms: Allen & Overy; EY Law; Hernández & Cía Abogados; Miranda & Amado Abogados; Muñiz, Olaya, Meléndez, Castro, Ono & Herrera; Rodrigo, Elías & Medrano Abogados; Sullivan & Cromwell;

Clients: Banco Interamericano de Desarrollo; Bank of China; China Three Gorges Corporation; Deutsche Bank; Odebrecht;