apresentação institucional 2q11
TRANSCRIPT
1
InstitutionalAugust, 2011
2
AES Brasil Group
• Presence in Brazil since 1997
• Comprised of seven companies in the sectors of energy generation, distribution, trade and telecommunications
• 7.6 thousand AES Brasil People• Investments 1998-2010: R$ 6.9 billion
• Good corporate governance practices
• Sustainable practices in businesses
• Safety as a main value• Strong cash generation capacity
• 25% of minimum pay-out according to bylaws
• Differentiated practice of dividend distribution since 2006:
– AES Tietê: 100% of net income on quarterly basis
– AES Eletropaulo: distribution above the minimum required (25% of net income) on semi-annually basis
3
(AES Eletropaulo) (AES Sul)
(AES Eletropaulo)
(AES Eletropaulo)
(AES Brasil)
(AES Tietê)
(AES Tietê)
(AES Eletropaulo) (AES Tietê)
(AES Tietê)
(AES Eletropaulo)
(AES Brasil)
AES Brasil widely recognized in 2009-2011
Quality and safety Management excellence Environmental concern
(AES Tietê)
(AES Eletropaulo)
4
AESInfoenergy
AESUruguaiana
AESCom Rio¹
AESEletropaulo
AESTietê
AES EletropauloTelecom¹AES Sul
AES Corp BNDES
C = Common SharesP = Preferred Shares
T = Total
Shareholding Structure
C 99.99 %T 99.99 %
C 99.99%T 99.99%
C 76.45%P 7.38%T 34.87%
Cia. Brasiliana de Energia
C 50.00% - 1 shareP 100%T 53.85%
C 50.00% + 1 shareP 0.00%T 46.15%
C 71.35%P 32.34%T 52.55%
C 98.25%T 98.25%T 99.70%
C 99.00%T 99.00%
1 – AES Atimus
5
24.2% 28.3% 39.5% 8.0%
8.5%56.2%19.2%16.1%
Others2Free Float
Listed Companies Shareholding Composition
1 – parent companies, AES Corp and BNDES, have equal voting capital on the Companies: 38.2% on AES Eletropaulo and 35.7% on AES Tietê2 – includes Federal Government and Eletrobrás shares in AES Eletropaulo and AES Tietê, respectively
¹ ¹
6CEMIG AES BRASIL NEOENERGIA CPFL TRACTEBEL COPEL EDP LIGHT DUKE CESP
2.3 2.2
1.81.6
1.21.0
0.6 0.6
0.20.1
AES Brasil is the second largest group in electric sectorEbitda1 – 2010 (R$ Billion)
Net Income1 – 2010 (R$ Billion)
1 – excluding Eletrobrás Source: Companies’ financial reports
CEMIG AES BRASIL CPFL NEOENERGIA TRACTEBEL CESP EDP LIGHT COPEL DUKE
4.54.2
3.43.0 2.6
2.0 1.6 1.6 1.5
0.6
7Source: ANEEL (Regulator) – BIG (August, 2011)
AES Tietê is the 2nd largest among private
generation companies and 10th largest overall
10 largest gencos correspond to 62% of the total
installed capacity
There are three mega hydropower plants under
construction in the North region of Brazil with 18 GW
in installed capacity
– Santo Antonio and Jirau (Madeira River): 7 GW
– Belo Monte (Xingu River): 11 GW
Generation Installed Capacity (MW) - 2011Privately held companies
Total Installed Capacity: 115 GW
AES Tietê is an important player among private energy generators
AES TIETÊ 2% DUKE
2%TRACTEBEL
6%
COPEL4%
PETROBRÁS 5%
CEMIG6%
ITAIPU6%
CESP6%
Eletronorte8%FURNAS
8%
CHESF9%
Others37%
8
AES Brasil is the largest distribution group in Brazil
Consumption (GWh) - 2010
Consumers – Dec/2010
• 64 discos in Brazil distributing 419 TWh
• AES Brasil is the largest electricity distribution group in Brazil:
– AES Eletropaulo: 43 TWh distributed,
representing 10.3% of the Brazilian
market
– AES Sul: 9 TWh distributed,
representing 2.2% of the Brazilian
market
There is a limited opportunity for competition in Brazil as discos are restricted to operate within their concession areas
13%
12%
10%
7%6%6%
6%
40%
12%
12%
12%
16%7%7%
5%
30%
AES Brasil
CPFL Energia
Cemig
Neo Energia
Copel
Light
EDP
Outros
10
AES Tietê Overview
17 hydroelectric plants within the states of São Paulo
and Minas Gerais
30-year concession valid until 2029; renewable for
another 30 years
Installed capacity of 2,660 MW, with physical guarantee1
of 1,281 MW
Almost all the amount of energy that AES Tietê can sell
in the long term is contracted to AES Eletropaulo until
the end of 2015
As a pure energy generator, AES Tietê can only invest in
its core business
338 employees
Generation facilities
1 - Amount of energy allowed to be long term contracted
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Hydro: 73%
SHPP: 4%
Natural gas: 8%
Biomass: 5%
Oil: 3%
Nuclear: 2%
Coal: 2%Diesel: 1%Wind: 1%Steam: 1%
Others: 10% Hydro: 67%
SHPP: 4%Natural gas: 7%
Biomass: 5%
Oil: 5%
Nuclear: 2%Coal: 2%Diesel: 1%
Wind: 7%
Steam: 0%
Others: 17%
Total installed capacity is expected to reach 171 GW by 2020
Brazilian energy matrix is not expected to materially change over the next 10 years
1- Source: EPE (Energetic Research Company), Ten-year Energy Plan 2020, May/2011 2 - Small Hydro Power Plant
Annual Growth: 4.5% p.a.
Energy sector in Brazil:supply perspectives
Installed Energy Capacity in Brazil1
2020: 171 GW2011: 115 GW
2
2
12
Distribution CompaniesTrading
Companies
Distribution Companies
Free Clients
Auctions
Energy sector in Brazil:contracting environment
Regulated Market Free Market
Spot Market PPAs1
1 – Power Purchase Agreement
• Main auctions (reverse auctions):
– New Energy (A-5): Delivery in 5 years, 15-
30 years regulated PPA1
– New Energy (A-3): Delivery in 3 years, 15-
30 years regulated PPA
– Existing Energy (A-1): Delivery in 1 year,
5-15 years PPA
Trading Companies
Free Clients
13
Energy Generation (MW average1) Billed Energy (GWh)
Billed energy growth due to high availability and bilateral contracts
1- Generated energy divided by the amount of hours 2-Leap year 3- Energy Reallocation Mechanism
AES Eletropaulo MRE Spot market Other bilateral contracts3Generation / Physical GuaranteeGeneration - MWAvg
2
13,148
14,706 14,729
7,881 7,507
2008 2009 2010 1H10 1H11
1,5121,665
1,599
1,809
1,608
138% 139%
118%
130%125%
2008 2009 2010 1H10 1H11
11,138 11,108 11,108
5,653 5,034
1,680 2,331 1,980
1,146 1,425
331 1,150 1,340
949 847
117 301
132 201 -5%
14
81%
14%5%
Equipment and Modernization
New SHPPs*
IT projects
Investments (R$ million) 1H11 Investments
Investments in the modernization of Nova Avanhandava, Ibitinga and Caconde
power plants
*Small Hydro Power Plants
2009 2010 2011 (e) 1H10 1H11
43 70
156
22 62
13 12
13
3
10 57 82
169
24
72
Investments New SHPPs*
+199%
CAGR: 44%
1511011011011011011011011011011061423242934384242422358111419
Current installed capacity Auctioned Upcoming auctions
+ 5%CAGR
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
110 110 110 110 110 110 110 110 110 110
6 14 23 24 29 34 38 42 42 422 3 5 8 11 14 19116 124 133
136 142149 156 163 166 171
Brazil needs to add 25 GW2 up to 2020
Total = 25 GW 2
2
2
Installed Capacity – GW 1 Growth by source – new auctions
Hydro8 GW
Wind/Renewable
11 GW
Thermal6 GW2
1 – Source: EPE (Ten-year Energy Plan – 2020) 2 – Amount related to thermal power plants is an estimate of the Company
16
Brazil needs higher firm capacity, which creates opportunities for gas fired thermal plants
Gas fired thermal plant – new scenario considering recent discoveries
Significant growth expectation for gas supply
Increase in natural gas production due to Pre-Salt activities
Expected growth of 11% p.a. from 2010 to 2020, according to Petrobras
Gas production - 10³ boe/day1
Water inflow by region / load2
Lower reservoir levels (new run-of-the-river power plants) create opportunities for thermal plants
1 – Source: Petrobras (Petrobras Strategic Plan 2020) 2 – Source : ONS
2005 2006 2007 2008 2009 2010 2014 2020
274 277 273 321 316 384
6231,109
2001 2005 2009 2013
6.25.7
5.4 4.7
17
Plant localization (Canas/SP)
• Timetable Jan/11 – Filed the EIA/RIMA at Cetesb Jun and Aug/11 - Public hearing hold in Lorena/SP and
Canas/SP cities - 2nd half of 2011: Power auction A-5 realization (expected)
Expansion of 550 MW of installed capacitythrough the Thermo SP Project
• Project features
- Combined cycle using natural gas- 2 gas turbines, 2 heat recovery boilers and 1 steam
turbine- Estimated investment of R$ 1.1 billion- Natural gas consumption: 2.5 million m3/day- Supply of gas pipeline: Campos Basin, Santos Basin or
Bolivia
• Project objectives- Expand installed capacity in the State of São Paulo- Offer competitively energy prices
Project Website: www.aestiete.com.br/termosaopaulo
SP
RJ Water Intake
Water Pipeline
Cana
s Riv
er
Dutra Highway
Transmission Line
200 m
GasPipeline
3.0 K
m
Termo São Paulo
Canas
Paraíba do Sul River
7.5 Km
SP
RJ Water Intake
Water Pipeline
Cana
s Riv
er
Dutra Highway
Transmission Line
200 m
GasPipeline
3.0 K
m
Termo São Paulo
Canas
Paraíba do Sul River
7.5 Km
18
(54)2008 2009 2010 1H10 1H11
1,309 1,311
9 1,254 1,255 1,320
678 643
Recurring Non-recurring
Ebitda (R$ million)Net Revenue (R$ million)
Financial highlights*
(*) 2009 and 2010 numbers in IFRS
CAGR: 5% CAGR: 3%
78% 75% 75% 79% 78%
Ebitda margin
2008 2009 2010 1H10 1H11
1,605 1,670 1,754
862 825
-4% -5%
19
100%
110%117%
12.0%11.0% 11.0%
0 , 0%
2 , 0%
4 , 0%
6 , 0%
8 , 0%
1 0 , 0%
1 2 , 0%
1 4 , 0%
1 6 , 0%
0%
20%
40%
60%
80%
100%
120%
816 784383
31
28
692 706 737
371 354
Net Income and Dividend Pay-out1 (R$ million)
1 – Gross amount (*) 2009 and 2010 numbers in IFRS
Practice of 100% pay-outon quarterly basis*
(74)(36)
(78)
Recurring Non-recurring IFRS EffectPay-out Yield Pref
2008 2009 1H10 1H112010
(40)
-5%
20
Debt profile
Net Debt (R$ billion) Amortization Schedule – Principal (R$ million)
• June, 2011:– Average debt cost in 1H11 was 113% of CDI1 p.a. or 13% p.a.– Average debt maturity of 2.8 years– Net debt: R$ 0.6 billion– Net debt/EBITDA: 0.5x
1 – Brazilian Interbank Interest Rate
Net debt / EBITDANet debt
2013 2014 2015
300 300 300
0.3x 0.3x 0.3x 0.4x 0.5x
2008 2009 2010 1H10 1H11
0.4 0.4 0.4 0.5 0.6
21
80
90
100
110
120
Dec-10 Mar-11 Jun-11
GETI4 IEE IBOV
Capital Markets
1 – Index: 12/30/2010 = 100
AES Tietê X Ibovespa X IEE Daily Avg. Volume (R$ thousand)
• Common shares and preferred shares listed on BM&FBOVESPA under the tickers GETI3 and GETI4
• ADRs at US OTC Market under the tickers AESAY and AESYY
+5%
-10%
+10%
YTD1
2008 2009 2010 1H11
5,468 8,086 9,683 9,531
2,692 2,101
4,239 3,447 8,160
10,187
13,922 12,978
Preferred Common
23
AES Eletropaulo Overview
Largest electricity distribution company in Latin America
Serving 24 municipalities in the São Paulo Metropolitan area
Concession contract valid until 2028; renewable for another 30
years
Concession area with the highest GDP in Brazil
45 thousand kilometers of lines, 1.2 million electricity poles and
6.1 million consumption units in a concession area of 4,526 km2
Total distributed volume of 43 TWh in 2010
As a pure energy distributor, AES Eletropaulo can only invest
within its concession area
5,613 employees
Concession Area
24
Reference Company(PMSO)
Investment Remuneration
Depreciation
Energy Purchase
TransmissionSector Charges
Tariff Reset and Readjustment
• Tariff Reset is applied each 4 years for AES Eletropaulo − Base date: Jul/2011− Parcel A: costs pass trough the tariff− Parcel B: costs are set by ANEEL
• Tariff Readjustment: annually − Parcel A costs pass trough the tariff− Parcel B cost are adjusted by IGPM +/- X(1) Factor
RemunerationAsset Base
X Depreciation
X WACC
Regulatory Ebitda
Parcel A - Non-Manageable Costs
Parcel B - Manageable Costs
• Remuneration Asset Base:– Applicable investments used to
calculate the Investment Remuneration (applying WACC) and Depreciation
• Reference Company:– Efficient cost structure, determined by
ANEEL (National Electricity Agency)
• Parcel A Costs− Non-manageable costs that totally
pass- through to the tariff− Losses reduction improve the pass-
through effectiveness
1 – X Factor: index that capture productivity gains
Energy sector in Brazil:regulatory methodology
252004 2005 2006 2007 2008 2009 2010 2011 (e) 2020
331 346 358 378 393 389419 441
659
Energy sector in Brazil:demand perspectives
4.4% p.a.
4.6% p.a
Macroeconomic Scenario
Brazilian Consumption Evolution (TWh)
EPE’s1 Assumptions:
• Emerging markets will grow faster than
developed economies, positively affecting
industrial sector in Brazil;
• Recovery of investment rates, favorable
credit conditions and labor market growth
• Domestic economy growth due to the
World Cup and Olympic Games
• Income elasticity of energy demand (2010-
2019): 0.98
• Households growth: 2.2% p.a
1 - Source: EPE (Energetic Research Company)
2005-2009 2010 2011-2015 2016-2020
World 3.4 4.6 4.5 3.9Brazil 3.6 7.2 5.0 5.0
GDP - Annual growth
26
Consumption Evolution
Total Market1 (GWh) 1H11 Consumption Share1 (GWh)
36%
14%
18%
26%
6%CAGR: 2%
1 – Net of own consumption
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
2008 2009 2010 1H10 1H11
33,860 34,436 35,434
17,437 18,216
7,383 6,832 7,911
3,823 4,149
41,243 41,26943,345
20,714 22,366
Captive Market Free Clients
+8%
36%
26%
19%
13%
6%
Residential
Commercial
Free Clients
Industrial
Others
27
Investments amounted R$ 325 million in 1H11
Investments Breakdown (R$ million) Investments 1H11 (R$ million)
0
100
200
300
400
500
600
700
800
2009 2010 2011(e) 1H10 1H11
478654
759
213315
37
28
26
16
10
516
682
784
229
325
Capex Paid by Customers
CAGR: 15%
+42%
108
79
72 20
13 10
24
Maitenance
Client Service
System Expansion
Losses Recovery
IT
Paid by the Clients
Others
28
SAIFI - System Average Interruption Frequency Index SAIDI - System Average Interruption Duration Index
SAIDI & SAIFI
8th5th 7th1st7th 3rd
Sources: ANEEL, AES Eletropaulo and ABRADEE
ABRADEE ranking position among the 28 utilities with more than 500 thousand customers
► 2011 SAIDI ANEEL Reference: 8.68 hours ► 2011 SAIFI ANEEL Reference: 6.93 times
2008 2009 2010 1H10 1H11
9.20 11.86 10.68 12.52 10.40
SAIDI (hours)
10.92 10.09
9.32
SAIDI Aneel Target
2008 2009 2010 1H10 1H11
5.206.17 5.43 6.34 5.48
SAIFI (times)
8.41 7.87
7.39
SAIFI Aneel Target
29
Losses (%)
1 – Current technical losses used retroactively as a reference
Collection rate (% over Gross Revenues)
Operational Indexes
2008 2009 2010 1H10 1H11
6.5 6.5 6.5 6.5 6.5
5.1 5.3 4.4 4.8 4.1
11.6 11.810.9 11.3 10.6
Technical Losses ¹ Commercial Losses
2008 2009 2010 1H10 1H11
98.5101.1
102.4 101.6 102.2
30
Ebitda (R$ million)Net Revenues (R$ million)
CAGR: 9%
Financial Highlights*
CAGR: 15%
(*) 2009 and 2010 numbers in IFRS
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
2008 2009 2010 1H10 1H11
7,530
8,7869,697
4,584 4,814
2008 2009 2010 1H10 1H11
1,607 1,486 1,630
837 840
- 202 357
166 234
89 87
426
265
1,696 1,775
2,413
1,268 1,074
Recurring IFRS Non-recurring
+5%-15%
31
101.5% 93.4%114.4%
20.3% 20.4%
28.6%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
120.0%
Pay-out Yield PN
2008 2009 2010 1H10 1H11
698 689836
346 376
93
162
117 162
329374
350
245
1,027 1,156
1,348
709
537
Net Income - ex one-off and regulatory assets and liabilitiesRegulatory assets and liabilitiesOne-off1 – Gross amount
Net Income and Dividend Payout1 (R$ million)
Practice of dividend distributionon semi-annually basis*
(*) 2009 and 2010 numbers in IFRS
-24%
32
Amortization Schedule – Principal (R$ million)
1 – Brazilian Interbank Interest Rate 2 – Pension Fund
• July, 2011:– Average debt cost in 2Q11 was 109% of CDI1 or 13.8% p.a.– Average debt maturity of 6.8 years– Net debt: R$ 3.0 billion – Net debt/EBITDA of 1.3x adjusted with Pension Fund
Debt ProfileNet Debt (R$ billion)
2H11 2012 2013 2014 2015 2016 2017 2018 2019 -2028
200 281 301531
225 335 225375
18044
67 46
49
5256
6064
867
244347 347
580
278391
285439
1,047
Local Currency (ex FCesp) Fcesp ²
2008 2009 2010 1H10 1H11
2.5 2.7 2.4 2.4 3.0
Net Debt (R$ billion)
1.5x1.4x
0.9x
Net Debt/Ebitda Adjusted with Fcesp
0.9x1.3x
33
80
90
100
110
120
Dec-10 Mar-11 Jun-11
1H11 ¹
+ 10%
- 10%
+5%
Average Daily Volume (R$ thousand)
Capital Markets
AES Eletropaulo X Ibovespa X IEE
• Common shares and preferred shares listed on BM&FBOVESPA under thetickers ELPL3 and ELPL4
• ADRs at US OTC Market
1 – Index: 12/30/2010 = 100
IBOV IEEELPL4
A Ex dividends: 04/30/2011
15,000.00
17,000.00
19,000.00
21,000.00
23,000.00
25,000.00
27,000.00
29,000.00
2008 2009 2010 1H11
25,677
21,960
24,496
28,096A
Social Responsibility
35
• 300 benefited children between 1 and 6 years old
• Own investments amounting R$ 2.1 million in 2010
• Units: Santo Amaro and Guarapiranga
• Over 5.2 thousand children, teenagers,
and adults have been benefited
• Own and incentive investments:
approximately R$ 17 million in 2010
• Activities of acting, dancing, circus arts, visual arts, music, gymnastics, courses of income generation, and education of safe use of electrical power and the right use of natural resources
• 7 operating units
“Casa da Cultura e Cidadania” Project
“Centros Educacionais Infantis Luz e Lápis” - Project
Social Responsibility
36
Social Responsibility
• Launched in December, 2008;• Objective: to get the co-workers committed to the transformation of low income communities and development of
non-governmental institutions;• 1,199 volunteers
Volunteering Program
Acting to Transform
Distributing Energy of
Good
Specific social mobilization or emergency campaign.
Winter clothes, Christmas campaign, among others.
Opportunities for volunteering in social organizations, which are
partners of AES Brazil
Co-workers can enroll in volunteer activities available at AES Brazil volunteering portal
since September/09www.energiadobem.com.br
Attachments
38
Costs and Expenses
Costs and operational expenses1 (R$ million)
1 – Do not include depreciation and amortization 2 - Personnel, Material, Third Party Services and Other Costs and Expenses
2008 2009 2010 1H10 1H11
239 214 246
103 114
112 201187
82 69
351 415 433
184 183
2
Energy Purchase, Transmission and Connection Charges, and Water Resources
Other Costs and Expenses
39
Costs and Expenses
Costs and operational expenses1 (R$ million)
1 – Do not include depreciation and amortization 2 - Personnel, Material, Third Party Services and Other Costs and Expenses3 – In 2009 expenses with Pension Fund increased due to inflation rate (IGP-M) increase and reversal of R$ 63 million in 4Q08 caused by actuarial liability adjustment
PMS and Other Expenses (R$ million)
2008 2009 2010 1H10 1H11
4,700 5,125 5,490
2,644 2,700
1,1931,306
1,255
670 716
5,8936,431
6,745
3,315 3,416
Energy Supply and Transmission Charges PMS² and Others Expenses
2008 2009 2010 1H10 1H11
485700 647
297 307
329
352 443
189 249
379
254 165
184 160
1,193 1,306 1,255
670 716
Personnel Materials and third party services Others
3
40
Expansion Requirement of 15% Increase installed capacity in Sao Paulo State by 15% (400 MW), either in greenfield projects or through long term purchase agreement with new
plants The obligation was supposed to be accomplished by December 2007, however AES Tietê was not able to comply with this requirement due to the
following restrictions:– Insufficient remaining hydro resources within the State of São Paulo
– Environmental restrictions
– Insufficiency of gas supply / timing issue
– More restricted regulation on energy sale established by the New Model of Electric Sector (Law # 10,848/2004) which eliminated the self dealing
• In August 2008, Aneel informed that the issue is not linked to the concession
• On July 27, 2009, AES Tietê was notified by the State Government Attorney’s Office to present arguments on compliance with the expansion obligation
– The Company filed a response on July, 29th, which exhausts the procedure for notification. Possible deployment depends on new manifestation of the Prosecution
• Popular law action against Federal Government, Aneel, AES Tietê, and Duke
– 2008 – In October, defense filed on first instance by AES Tietê; In December, the author replied AES Tietê defense – 2010 – In September, due to the plaintiffs failure to specify the individuals that should be named as Defendants, a favorable decision was
rendered by the 1st Instance Court (but there can be appeals)
• Efforts being made by the Company to meet the obligation:– Signing of two long-term energy contracts, from sugar cane biomass, totaling 10 MW– SHPP São Joaquim, which started operating in July, 2011 with 3 MW of installed capacity, in São João da Boa Vista (State of São Paulo)
– SHPP São João, with 4 MW of installed capacity, in São João da Boa Vista (State of São Paulo), to be operational in 2011
– Project development of a 550MW gas fired thermal plant, located in Canas (State of São Paulo)
41
Next Steps:
1 - The auditing procedure will be concluded in at least 6 months
2 - After conclusion of the
expert work, the 1st
level of court decision will be
released
3 - Appealing to the 2nd level of
court
4 - Appealing to the 3rd level of
court
Eletrobras Lawsuit
Nov/86
Stated-owned Eletropaulo
borrowed money from Eletrobras
Dec/88
State-owned Eletropaulo and
Eletrobras disagreed on how
to calculate interest over that loan and a lawsuit
was started
Sep/03
The 2nd level of court excluded
AES Eletropaulo from the
discussion based on the spin-off
agreement
Jun/06
The SCJ decided to send the
Execution Suit back to the 1st
level of court
May/09
Eletrobras requested the 1st
level of court judge to appoint
an expert
Jan/98 Oct/05
Eletrobras and CTEEP appealed
to the Superior Court of Justice
(SCJ)
Dec/10Sep/01
Eletrobras, after winning the
interest calculation
discussion, filed an Execution Suit to collect the due
amount
State-owned Eletropaulo was spun-off into four companies and, according to our understanding based on the
spin-off agreement, the discussion was transferred to
CTEEP
Privatization event . State-
owned Eletropaulo
became AES Eletropaulo
Apr/98
Eletrobrasrequested the
beginning of the appraisal
procedure, which is under 5th Civil Court analysis.
Jul/11
On July 7, the judge determined Eletropaulo and
CTEEP to present their
considerations, which occurred on Aug, 10, for the definition of
the expert
42
Any party with an intention to dispose its shares should first provide the other party the right to buythat participation at the same price offered by a third party
Once the offering party exercises the Drag Along clause, offered party is obligated to dispose of all its shares at the time, if the Right of 1st Refusal is not exercised by offered party
In the case of change in Brasiliana’s control, tag along rights are triggered for the following companies (only if AES is no longer controlling shareholder):
– AES Eletropaulo: Tag along of 100% in its common and preferred shares– AES Tietê: Tag along of 80% in its common shares– AES Elpa: Tag along of 80% in its common shares
Shareholders AgreementOn Dec 2003 AES and BNDES signed a Shareholders’ Agreement to regulate their relationship as shareholders of Brasiliana and its controlled companies. The Agreement is available at www.aeseletropaulo.com.br/ri
Shareholders can dispose its share at any time, considering the following terms:
Right of 1st refusal
Drag alongrights
Tag alongrights
43
Brazilian Main Taxes
AES Eletropaulo
• Income Tax / Social Contribution:
– 34% over taxable income
• ICMS: 22% over Revenue (average rate)
– Residential: 25%
– Industrial and Commercial: 18%
– Public Entities: free
• PIS/Cofins:
– 9.25% over Revenue minus Costs
AES Tietê
• Income Tax / Social Contribution:
– 34% over taxable income
• ICMS (VAT tax)
– deferred tax
• PIS/Cofins (sales tax):
– Eletropaulo´s PPA: 3.65% over Revenue
– Other bilateral contracts: 9.25% over Revenue
minus Costs
The statements contained in this document with regard to the business prospects, projected operating and financial results, and growth potential are merely forecasts based on the expectations of the Company’s Management in relation to its future performance. Such estimates are highly dependent on market behavior and on the conditions affecting Brazil’s macroeconomic performance as well as the electric sector and international market, and they are therefore subject to changes.
Contacts:[email protected]
+ 55 11 2195 7048