Comgas

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Comgas is a gas distribution company in Sao Paulo. The company started to be privatized in January 1997, when the Sao Paulo municipal government sold a minority stake (19.86%) in Comgas for the minimum price of US$ 70.9 million to Shell International Gas. In a second transaction on April 14, 1999, the state of Sao Paulo-owned power generation utility, Companhia Energetica Sao Paulo (CESP), sold its 52.7% controlling stake in Comgas for US$ 988 million to a consortium made up of British Gas, Shell, and Sao Paolo utility Companhia Paulista de Forca e Luz (CPFL). The winning consortium consisted of British Gas (95%) and Shell (5%). Proceeds from the sale went to the parent firm of Comgas, CESP, which used the amount for the sell-off of three electric generating facilities. The winning consortium committed to invest $200 million over the following three years to improve the Comgas distribution network throughout metro Sao Paulo and to boost the natural gas market. The Comgas concession is a 30-year franchise, with a potential for a further 20 years. In December 2004, Comgas received a US$156 million loan from BNDES to expand and modernize its gas pipeline network. In August 2012, BNDES approved another loan to finance Comgas' network expansion amounting to US$ 581.5 million (BRL 1135 million). This value represented 56% of the total the company set to invest in the 2012 - 2014 period. In September 2013, Comgas issued US$ 229.4 million (BRL 540 million) in long-term bonds. Although the 1999 share sale was for 52.7%, the additional shares were traded in the market. According to Comgas, www.comgas.com.br, 100% of the shares are owned by British Gas, Shell, and another company (3%).