Empresa Valle Hermoso SA

cancelled

Empresa Valle Hermoso is one of the three companies into which Bolivian Empresa Nacional de Electricidad's generation assets were corporatized for the Brazilian capitalization program. The other two companies are Empresa Corani SA and Empresa Guaracahi SA. Valle Hermoso had a capacity of 179-MW in operation or under construction in 1995. Its capacity is made up of four gas-fired combustion turbines representing 71.5-MW and two 54-MW turbines. By 1998 its capacity had increased to 189 MW. Empresa Valle Hermoso was partially privatized in July 1995 when the Ministry of Capitalization sold 50% of the equity to the Bolivian Generating Group consortium for $33.92 million. The consortium members are Constellation Power, Ogden Energy, Power Market Development, and Energia Andina. The transaction included a debt transfer of $14.3 million. Under the Bolivian capitalization program, each company issued new shares equivalent to 50% of its new equity. This capital increase was sold to a private consortium through a competitive bidding process. The winning offer was in terms of the company's capital increase which would be invested in business expansion. The remaining 50% equity stake was transferred to private citizens and managed through private pension fund managers. The consortium that won the 50% stake received all management rights for five years, or until the amount of capital to be invested is exhausted. The three new owners, Corani, Guaracachi and Valle Hermoso, plus Compania Boliviana de Energia Electrica (Cobee) have exclusive rights to new generation licenses until 2000, and exclusive rights to licenses for power plants to export power until 1999. However, any private participant of winning consortium cannot own more than one generation company or also own distribution companies. In 2002 Valle Hermoso's sponsors included Constellation Energy, Pennsylvania Power and Light (PPL), and Covanta Energy. At the conclusion of 2002 the US-based consortium divested their stake to a local consortium of investors - Bolivian Generating Group. In early 2003 Bolivian Generating Group sold Valle Hermoso to Panamerican Investments. In October 2009, the Bolivian government concluded negotiations with three main generating companies created from the the privatization of ENDE, and aimed to secure state control with a share of 60–70%. As of December 2009, the Bolivian government held the following shares in its generation companies Corani (42.7%), Guaracachi (49.82%), and Valle Hermoso (49.86%). Bolivian Generating Group consortium controlled Empresa Valle Hermoso SA in 2009. In May 2010, a Bolivian government decree stated that the state was taking control of the stakes that private investors held in four power companies, including Corani, Guaracachi and Valle Hermoso.