Company News Aug 19, 2021 2:22 PM
Ecopetrol’s (NYSE: EC) Felipe Bayón talked about the acquisition of ISA, and the steps to follow in this process.
Bayón told La Republica that ISA will allow ECP to become a leader in the energy and infrastructure business.
He explained that there is a maximum closing deadline for the transaction on December 6th this year, but the company is making every effort to achieve it in three to four weeks.
“It is a step towards Ecopetrol Group’s energy transition, its path towards decarbonization and reducing exposure to oil price volatility,” Bayón highlighted.
The expert recalled that the company does not need a share issue to finance the acquisition, but this does not mean that this option is totally ruled out.
Bayón said that the company is focused on closing the transaction for the time being and, once that happens, Ecopetrol will exercise control under the terms of commercial law.
“Ecopetrol and ISA have compatible corporate governance designed to the highest standards. In this way, we would initiate a cycle of integration to achieve rapprochement, understanding and work between the companies, consolidating a leading group in energy and infrastructure businesses,” the CEO said.
He said that the commitment is to keep ISA as ISA, and Ecopetrol’s core business will continue to be oil and gas.
Bayón said that the Castilla Ecopark is already operating with 21MW of generation.
“We are building the San Fernando park with 75% progress (61MW) and the goal is that in September it will start with modular operation,” the CEO said.
The expert said that the company is conducting wind speed studies in Cartagena, Casanare and Huila to determine if there is a possibility of wind farms.
“We are advancing in the geothermal pilot and the goal is to have 400MW of installed capacity by 2023,” Bayón said.
Bottom-Line: The companies have not yet mentioned the synergies generated after this transaction. We are still waiting for them…
It is positive to hear that ECP will continue to bet on renewable energies, but authorities should clarify if this is possible, considering that the company is now part of the transmission business…
Finally, has Ecopetrol and MinEnergia forgotten that, once they control ISA, they will be prohibited from doing generation? Some enterprising law student will no doubt find suing to be an interesting school project.