Hidroelectrica Alicura SA

distressed

The Alicura hydroelectric plant was owned by Hidroelectrica Norpatagonica Sociedad del Estado, an Argentine state-owned company. The facility had an installed capacity of 1,000-MW in 1993. Hidroelectrica Alicura SA was created in order to privatize the hydro-power plant. The company was partially privatized in August 1993 when a 59% equity stake was sold for $178 million to Southern Energy, SEI Holding (47.2%), Asociados de Electricidad (8.2%), Diecisiete de Abril S.A. de Inversiones (2.9%), and Resource Development Consultant (0.59%). The consortium paid $48 million in cash and $130 million in debt papers. The winning consortium was awarded a 30-year concession to operate the Alicura hydroelectric plant and an option to renew the concession for 25 years. Later, a 2% equity stake was sold to the company's employees and the remaining 39% was reserved for the provinces of Neuquen and Rio Negro. In Aug. 2000, AES bought SEI's shares in Alicura by assuming a US$ 200 million debt and paying US$ 1.5 million in cash (at this time, SEI's equity stake was 59%). In Dec. 2000, AES announced it had acquired an additional (39%) stake in Alicura (acquired from the federal and provincial governments). As of January 2001, AES was holding 98% of Alicura's shares, while the employees hold 2%. In 2002, AES Corporation filed legal proceedings with an international arbitration tribunal (International Centre for Settlement of Investment Disputes - ICSID) against the Argentinean government. The proceeding seeks compensation for losses incurred by the company at the time of the devaluation of the Argentinean currency. For updates on the international arbitration proceedings, check http://www.worldbank.org/icsid (case # ARB/02/17).