MPX ENERGIA S.A. CNPJ/MF: / Publicly-Held Company BOVESPA: MPXE3

Transcription

1 MPX ENERGIA S.A. CNPJ/MF: / Publicly-Held Company BOVESPA: MPXE3 MATERIAL FACT NOTICE MPX and E.ON to form Joint Venture to Foster Growth in Brazil -- E.ON to achieve a 10% Equity Interest in MPX through a Capital Increase -- Rio de Janeiro, January 11, 2012 MPX Energia S.A. ( MPX )(Bovespa: MPXE3, GDR I: MPXEY), a Brazilian diversified energy company with the largest portfolio of licensed integrated energy projects in South America, in compliance with article 157, paragraph 4th of Brazilian Law No /76, as amended ( Brazilian Corporations Law ) and CVM Instruction 358/02, hereby announce that it has entered into a Term Sheet with E.ON AG ( E.ON ), one of the world's largest investor-owned power and gas companies, establishing the main terms and conditions of a Transaction (the Transaction ) pursuant to which (i) MPX and E.ON will form a 50:50 joint venture ( JV ) in order to leverage the strong complementary capabilities of both companies to accelerate growth and build a more sizable and profitable power business in Brazil; and (ii) MPX will raise R$1,000,000, (one billion and sixty-three Brazilian Reais) through a capital increase of which E.ON shall ultimately invest approximately R$850 million for a 10% stake at MPX. The partnership between MPX and E.ON shall result in the creation of the largest private energy company in Brazil, with the goal of reaching a total generation capacity of 20 GW. E.ON has identified Brazil as a priority region for future investments and has selected MPX as the best fit for a partnership that will serve as a platform to capitalize upon the country s high growth prospects. The Transaction according to the Term Sheet contemplates: (a) Joint Venture between MPX and E.ON The JV to be formed between MPX and E.ON will be the sole investment vehicle for new power projects undertaken by MPX and E.ON in Brazil and Chile, and will include development, execution and operation of all thermal and renewable projects of both companies in Brazil and Chile and all supply and trading activities. The JV will be a newly formed corporation to be held by MPX and E.ON on a : shareholding basis. MPX will contribute to the JV, at accrued development costs, (a) of MPX s pipeline of thermal projects without power purchase agreements ( PPA ) ( Current Thermal ) and, in addition, for the Açu Power Projects, E.ON will have a call option on behalf of the JV for additional 38.9% of the project at book value, thus enabling each of the partners to achieve a economic interest in the project; (b) 100% of

2 MPX s supply and trading activities; (c) 100% of MPX s renewable energy projects ( Current Renewables ); as described below: Current Thermal Fuel MPX S.A. () (GW) JV () (GW) Total Capacity (GW) Parnaíba* Natural Gas Açu Natural Gas Açu Coal Castilla (Chile) Coal Sul + Seival Coal Total * Parnaíba figures consider only MPX s 70% interest in the project (remaining 30% owned by Petra Energia S.A.). Current Renewable Source Total Capacity (MW) Tauá Solar 5 MW Ventos do Açu Wind 113 MW In addition to the remaining of the Current Thermal as described above, MPX will retain its current ownership of the contracted power capacity currently under operation and construction, namely the Energia Pecém, Pécem II, Itaqui, Parnaíba and Amapari Power Plants as well as of the natural gas concessions in the Parnaíba Basin, held through OGX Maranhão Petróleo e Gás S.A., with risked prospective resources of over 11 Tcf, and of the Seival coal (lignite) mine, as described below: Power Plants Fuel Installed Capacity (MW) Energia Pecém 1 Coal 365 Pecém II Coal 365 Itaqui Coal 365 Parnaíba 2 Gas 1,087 Amapari 3 Oil 12 Total 4 Gas + Coal + Oil 2,194 (1) Pecém I figures consider MPX s interest on the project (remaining owned by EDP). (2) Parnaíba figures consider MPX s 70% interest on the project (remaining 30% owned by Petra Energia). (3) Amapari figures consider MPX s 51% interest on the project (remaining 49% owned by Eletronorte). (4) Gross capacity including minority interest equals GW In order to enable the JV to accelerate the implementation of its pipeline of projects, E.ON and MPX will on a project-by-project basis - decide on E.ON s potential pre-financing of MPX s equity proportion at the JV level.

3 (b) Acquisition of minority equity interest in MPX MPX will raise R$1,000,000, (one billion and sixty-three Brazilian Reais) through a capital increase ( Capital Increase ) of which E.ON shall ultimately invest approximately R$850 million so as to achieve a targeted 10% shareholding ( Target Shareholding ). E.ON will initially make a total investment ( Investment ) of up to R$ 1.0 billion. The final value to be invested by E.ON shall be adjusted according to put/call option arrangements between Mr. Eike Batista and E.ON for the Target Shareholding to be achieved ( Put/Call ). Following the exercise of the Put/Call before the end of 2012, the Investment shall amount to approximately R$ 850 million. The applicable strike price of the put/call options shall be the price per share of the Capital Increase adjusted by the IPCA. As part of the minority holding, E.ON will be entitled to have a representative at MPX s Board of Directors. The Investment will be made after the conversion of debentures into common shares of MPX and after approval by MPX convertible debenture holders of the spin-off from MPX of the Colombian coal mining assets to a new corporation to be created and the transfer of up to RS$ 814 million of cash currently held by MPX to this new corporation, to be designated CCX" ("Spin-off"). Following the Spin-off, CCX will become an independent company, listed at the BM&FBovespa Novo Mercado, and MPX shareholders will be entitled to one share of CCX for each share of MPX they hold. MPX debenture holders who opt not to convert the debentures into common shares of MPX prior to the Spin-off will not be entitled to receive shares of CCX. MPX s Board of Directors will then resolve upon the Capital Increase with the issuance of new common shares of MPX in a total amount to be determined by the Board of Directors in order to allow the Investment to be implemented. MPX shareholders shall be entitled to preemptive rights for subscribing to the Capital Increase. Mr. Eike Batista shall assign to E.ON his pre-emptive rights in the issuance of new common shares of MPX so as to allow E.ON to make the Investment and achieve the Target Shareholding. MPX and E.ON are convinced of the outstanding value that the transaction and the pipeline of MPX represent. The Capital Increase therefore represents a significant premium to market valuations. The price per share of the Capital Increase will reflect conversions of MPX debentures into common shares of MPX.

4 MPX Ownership Structure After Proposed CCX Spin-Off, JV and Capital Increase Eike Batista Free Float E.ON ~10.0% MPX 100% 100% Power Generation (with PPA) Natural Resources MPX- E.ON JV 50/50 Energia Pecém (365 MW) Pecém II (365 MW) Itaqui (365 MW) TPP Parnaíba (1,087 MW) Amapari (12 MW) Seival OGX Maranhão Current Thermal Supply & Trading 100% 100% Current Renewable 100% New Generation Projects MPX has consistently demonstrated outstanding development and licensing expertise, as evidenced by its 14 GW pipeline of licensed power generation projects. Additionally, with its extensive knowledge of the Brazilian power market, MPX has designed a successful vertically integrated strategy, procuring highly competitive fuel supply to its plants. The Company s commercial acumen has enabled it to secure highreturn, long-term PPAs for approximately 3 GW in just four years, which are currently under construction and should be fully operational by Through this joint venture, MPX will be able to leverage E.ON s global platform, expertise in crosstechnology project development, senior management experience and extensive capabilities in generation. This is a highly strategic and value enhancing partnership for both companies. Together, we can create a business that is much more than a sum of its parts, generating exciting growth opportunities in the years to come for all of our stakeholders, said Eike Batista, MPX s Chairman of the Board. The partnership will also further strengthen MPX s renewables and gas platforms as E.ON is among the world s leading renewables companies, with almost 4 GW in wind capacity and a strong presence in solar and biomass. A major gas player, with a procurement of 64 bcm of natural gas and upstream production including equity gas of about 7.5 bcm per annum, E.ON also owns and operates significant gas storage capacity in Europe and a gas transmission system of 12,000 km. Moreover, the JV will benefit from E.ON s vast experience in developing, executing, and operating a power portfolio of 69 GW split between renewables, gas, coal and nuclear, and its global trading and supply capabilities, which will enhance the efficiency of the entire supply chain and help to maximize cash flows. In 2010 alone, E.ON's trading arm, backed by one of the broadest and most diverse power and gas asset bases in Europe, traded about 1,500 billon kwh of power, 2,000 billion kwh of gas, 650 million metric tons of carbon, and almost 300 million metric tons of coal.

5 The signing and closing of the Transaction is subject to applicable corporate and third-party approvals and negotiation of the definitive Transaction documentation. MPX and E.ON will keep their shareholders, investors and the market informed of any new steps taken towards the implementation of the Transaction. It is the aim of the parties to conclude this Transaction before end of Q MPX will host a conference call on Wednesday, January 11, 2012 at 12 PM (Brasília time)/ 09 AM (US ET). Please find the conference call information below: Phone (Brazil): Phone (USA): Phone (Other countries): Code: MPX Eduardo Karrer CEO and Investor Relations Officer MPX Energia S.A. ABOUT MPX MPX Energia S.A., an EBX Group company, is a Brazilian diversified energy company with complementary businesses in power generation, coal mining, and natural gas E&P in South America. The Company has a large portfolio of integrated energy projects, exceeding 14 GW of capacity, which positions it to be a leading private-sector power generator. In Colombia, MPX has a world-class coal company with potential compliance coal resources to support production of 35 million tons per year and integrated infrastructure that includes a 150 km railway from the mines to the coast and a deep-water port. Coal produced in Colombia will be sold internationally in addition to potentially supplying MPX plants in Brazil and Chile. MPX power generation plants will also be the primary off-takers of the natural gas produced in the Company s unique onshore portfolio, with estimated risked resources of over 11 Tcf. ABOUT E.ON E.ON s diversified business consists of power generation, natural gas, energy trading, retail and distribution. One third of E.ON's 69GW balanced portfolio is generated by low carbon technologies, including on and off-shore wind farms. E.ON operates one of the world s top ten renewables companies. In addition, the company also operates large power and gas distribution systems and supplies 26 million customers with energy. At facilities across Europe, Russia, and North America, its more than 85,000 employees generated 93 billion in sales in E.ON s mission is to deliver innovative energy solutions to its customers and to create superior value for its investors. And to do it in a way that protects the environment, keeps people safe, and makes life better in the regions where the company operates. In short, E.ON is committed to making energy cleaner and better wherever it does business.

6 Investor Relations: Flavia Heller Priscylla Setimi Luiza Santoro Press: Roberto Gonzales / Carla Assemany /