José Luis Manzano, Mauricio Filiberti and Daniel Vila bought 51% of Edenor. They want to have the operation closed by the end of April, which would be a record time for a $ 100 million transaction. But doubts arise about what the approval process will look like in regulatory terms.
In Pampa Energía, the seller of 51% of Edenor, and in the buyer group describe the following procedure: first, the operation is treated by the assembly of Pampa, then the regulatory body (Enre) is issued, and when that approval is obtained, the procedure is turned to the National Commission for the Defense of Competition (CNDC), which is the body that authorizes mergers and acquisitions.
But sources from the CNDC indicated that the operation should take another course. Although they were not notified “formally”, they explain that “when the operation arrives it will be dealt with simultaneously with the Enre.” In that scenario, the process would require two simultaneous approvals, and not one as buyer and seller say.
Clarion He also consulted Enre about the times this operation could take, but received no response.
A specialist review by various past M&A transactions indicates that the timelines for these transactions they are longer than the four months that buyers want.
The buyer -Edelcos- is made up of Daniel Vila, Mauricio Filiberti, José Luis Manzano, Andina and Global Income Fund Limited. “Edenor will be taken over once all the conditions had been met established precedents, including obtaining ENRE approval ”, they detailed at the time.
Mindlin has to pocket US $ 95 million between the closing of the operation -which can be at the end of the first semester of 2021- and the following 12 months. There is a clause that enables you to receive an extra 50% in case buyers resell the company.
After the closing of the transaction, a public offer will be made to the rest of the company’s shareholders, as established by the National Securities Commission and the regulations of the Securities and Exchange Commission (SEC) of the United States, they reported.
“I do not know the terms of the operation, nor the parties involved (specifically), although I assume that in principle, if it is a US $ 100 million operation, it would be required to be approved by CNDC,” explains a former official who went through that regulator.
“It is necessary to see if the exceptions of notification of the law do not apply to him, that I believe difficult that they apply to him, but – again – I do not know the details”, indicated.
The antitrust laws establish strict deadlines (45 or 120 days, if it is resolved in a normal process or an extended process, respectively). But those deadlines they are almost never fulfilled.
“The authority usually makes requests for information, leaving the ‘start’ of the time count (from the beginning of the file) subject to the information being complete,” says the same competition specialist.
Is the prior approval of the Enre a green light for the Defense of Competition, I ask Clarion to a former authority of that body. “As far as competition is concerned, not necessarily; although they must take a hearing for the ENRE to give an opinion. What the ENRE says is not binding on the competition authority, “he said.
AB Inbev (owner of Quilmes) made an asset acquisition of Sab Miller: It was notified in October 2016 and resolved in February 2018. Brazil’s Brahma had bought Quilmes in 2002, but did not get the green light from the regulator until three years later.
Mexico’s Bimbo obtained authorization to buy Fargo in 2004. However, conditions were imposed there – such as disposing of some assets – that they were completed in 2010. A sample that these transactions are not usually “express”.
What happens in the Enre will be key to seeing the future of the process. The comptroller (María Soledad Manín) responds politically to Federico Basualdo (who preceded her in that position and is now an official of the Ministry of Energy). Basualdo usually makes his decisions in in tune with the wishes of the vice president Cristina Fernández de Kirchner, who proposed him for the position. There is rumors about a resistance of the former president to this operation.
In the case of Manzano and Vila, they also own Edemsa, Mendoza’s electricity distribution company. If they obtain the regulatory endorsement, both shareholders will control the electricity distribution of the Cuyo province and half of Buenos Aires and the suburbs.
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source https://pledgetimes.com/two-agencies-must-give-the-green-light-for-the-sale-of-edenor-and-there-could-be-delays/
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