15 November 2012

Mitsui and ENAC acquire Brazilian energy services provider Ecogen

15 November 2012 - Mitsui & Co., Ltd. and Energy Advance Co., Ltd. (ENAC), which is a 100% subsidiary of Tokyo Gas Co., Ltd., are participating in energy service business utilizing a natural gas based cogeneration system (heat and power co-supply system) in Brazil. 

Mitsui and ENAC agreed to acquire all of the shares of the holding company of Ecogen Brasil Soluções Energéticas S.A. ("Ecogen") through a jointly-established investment subsidiary, and the shareholders of Ecogen's holding company and the investment company entered into a Share Purchase Agreement on Nov. 14th, 2012. 

Ecogen is the biggest energy service provider in Brazil, which mainly utilizes natural gas based facilities. The company provides the engineering of a natural gas cogeneration system which meets customers' energy requirements, and also long-term rental, operation and maintenance service to shopping malls, commercial buildings, hotels and so on principally in urban areas such as Sao Paulo and Rio de Janeiro. 

Mitsui and ENAC aim to lead Ecogen to further growth by meeting the needs of industrial clients which have potential demand for cogeneration due to their huge thermal requirements, in addition to the commercial customers which are Ecogen's main clients at present. To improve the corporate value of Ecogen, Mitsui will utilize the knowledge of its 100% subsidiary Mitsui Gás e Energia do Brasil Ltda., which has shares in local gas distribution companies in seven Brazilian states, and ENAC will provide the technical and commercial know-how related to the operation and maintenance of the cogeneration system, which it has accumulated through experience in Japan. 

In the midst of promoting the expansion of infrastructure to host the football World Cup and the Olympic Games, securing additional sources of electricity is an urgent issue in Brazil. Furthermore, there is strong demand for cogeneration systems, which generate electricity independently from the existing power plants connected to grid, as a solution to frequent blackouts, and strong growth is foreseen. In addition, demand for natural gas cogeneration systems is predicted to increase, which will be associated with the enhancement of gas supply due to the plan to go into full-scale gas production from the offshore gas field in the local pre-salt layer from 2017. 

While Mitsui undertakes this project to enhance its gas value chain business in Brazil, one of its strategically important regions, ENAC will address it as the first foreign energy service project of the Tokyo Gas group, which is consistent with the group's aims in its "Challenge 2020 Vision". 

Mitsui and ENAC will contribute to Brazil's economic growth and improvement of the natural environment by providing clean energy supply services in Brazil and introducing highly-functional and highly-efficient Japanese facilities related to cogeneration systems. 

Ecogen Brasil Soluções Energéticas S.A. was established in 2002 and its head office is in the State of Sao Paulo, Brazil. It had revenues of US$23 million in 2011 and 130 employees as of the end of October 2012. 

Investment subsidiary ME Serviços de Energia do Brasil Ltda is based in the State of Rio de Janeiro, Brazil. The shareholders are Mitsui 90% and ENAC 10% 

Source: Mitsui