Canada's Brookfield poised to snap up Colombia generator in auction

BOGOTA, Jan 13 (Reuters) - Canada's Brookfield Asset
Management BAMa.TO looks set to buy up the controlling stake
in Colombian power generator Isagen ISG.CN , valued at nearly
$2 billion, on Wednesday after another possible bidder withdrew
from the auction this week.
The 57.6 percent stake has a minimum price of 6.48 trillion
Colombian pesos ($1.98 billion) and is the largest privatization
in the country in nearly a decade.
The government plans to use proceeds to fund highways,
bridges and tunnels across the country, its so-called 4G
infrastructure projects.
Chile's Colbun COL.SN withdrew from bidding on Monday, in
part because of a 21.5 percent increase in the minimum price,
the company said.
The depreciation of the peso currency and the government's
fiscal struggles amid a global fall in the price for crude oil,
Colombia's largest export and source of foreign exchange, make
the sale particularly beneficial, analysts said.
"It's a win-win," said Rupert Stebbings, vice president of
equity markets at Bancolombia. "The government is getting way
more local pesos - back of the envelope they're getting about 25
percent more in local pesos then they would've gotten a year
ago, and the Canadians are buying it at around 25 percent
cheaper than they would have a year ago in dollars."
"The money is much better spent in the 4G, in the
infrastructure projects, than receiving dividends every year,"
Stebbings said.
The sale of Isagen, which operates seven power plants across
the country, has been suspended at least twice because of legal
challenges. A last minute appeal by a left-wing senator to halt
the auction was rejected late on Tuesday.
Brookfield, which has around $225 billion of assets under
management, set up a $400 million fund to invest in Colombian
infrastructure assets in 2009.
In recent years, it has expanded its operations in South
America, where it now operates $16 billion of assets, investing
in property, renewable energy, utilities, agriculture and
timberland in Brazil, Chile, Peru and Colombia.
It acquired Transelec, the largest electricity transmission
system in Chile in 2006. It 2011, it purchased an electrical
distribution business in Colombia and, in 2012 and 2013, it
bought toll road networks in Brazil and Chile.