Shares in Brazil's AES Tiete slump as BNDES reaches deals with AES Corp

SAO PAULO (Reuters) – Shares in the Brazilian power company AES Tiete Energia SA (TIET11.SA) fell 7.7% after development bank BNDES agreed to sell part of its stake to the firm’s controlling shareholder AES Corp (AES.N).

AES Corp offered to buy 65% of BNDES’ stake in AES Tiete for 17.15 reais ($3.33) per share in cash. The sale will reduce BNDES’ stake to 9.9% from 28.41%, while AES Corp will hold 42.86% after the deal.

Besides AES Corp’s offer only to the state-controlled lender, BNDES and all AES Tiete’s shareholders on Monday received a merger proposal from power company Eneva SA (ENEV3.SA), involving cash and shares, with a 17% premium over AES Tiete’s market value at the time.

Units in AES Tiete, comprising one common share and four preferred shares, tanked as the power company’s shareholders were left with no proposed deal.

Eneva issued a statement on Tuesday saying it will “continue to work on generating value to its shareholders, focused on the development of its business plan and always attentive to opportunities that represent the best interest of all its shareholders and stakeholders.”

Shares in Eneva fell 1.8% in early afternoon trading, underperforming Brazil’s stock exchange index.

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