SYDNEY--GDF Suez SA is looking to sell a major stake in its
Australian electricity generation and retail business, as the
French power group intensifies moves to cut debt and boost profit
hurt by Europe's slow recovery from the global financial crisis,
people familiar with the matter said.
GDF Suez has hired Deutsche Bank to find a buyer for around 30%
of its International Power (Australia) Holdings Pty Ltd unit, which
runs a coal-fired power plant in Victoria state along with two
gas-fired power plants and a wind farm in South Australia state,
the people said. The IPAH business also sells power and gas to more
than 350,000 customers in Victoria.
Any deal would likely see GDF Suez retain a stake of around 40%
in IPAH, the people said.
It comes more than six months after GDF Suez sold 28% of IPAH to
Japan's Mitsui & Co., while the French power group has also
been reducing its stakes in other assets globally that it considers
to be noncore.
In August, the group sold 50% of its Portuguese power assets to
Japanese trading house Marubeni. That deal came three months after
it also sold a 20% stake in a giant dam in Brazil to Mitsui. Late
2012, GDF Suez also sold a 60% stake in a wind and solar power
project Canada, to Mitsui and a consortium led by Fiera Axium
Infrastructure.
GDF Suez outlined a strategy of selling assets in late 2012 to
help it cut debt and protect profits at a time when European power
demand was in the doldrums. The company has also suffered from a
surge in supply of heavily subsidized renewable energy, ripples
from the U.S. shale revolution and inconsistent government
policy.
These challenges led the company to write down its assets by
nearly 14.9 billion euros (US$20.2 billion) last year, mostly to
reflect the drop in value of its power-generation assets in
Europe.
Write to David Winning at david.winning@wsj.com and Geraldine
Amiel at geraldine.amiel@wsj.com
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