Iberdrola has agreed to acquire an additional 30.29% stake in Neoenergia, a Brazilian energy distributor.

The Spanish utility will buy the stake from Caixa de Previdência dos Funcionários do Banco do Brasil (PREVI), lifting its interest in Neoenergia to 84%.

The agreed deal consideration is 11.95bn reais ($2.2bn), or 32.5 reais per share.

This deal is pending regulatory approval, with completion anticipated in the coming months.

Neoenergia serves nearly 40 million Brazilians and is the largest distribution group in the country by customer numbers.

It operates five distribution companies across various states and 18 transmission lines.

Neoenergia’s infrastructure includes over 725,000km of distribution lines, 8,000km of transmission lines, and 3,800MW of primarily hydroelectric renewable generation capacity.

In 2024, the company invested over 9.8bn reais in Brazil’s basic infrastructure, focusing on expansion, modernisation, maintenance, and automation of its networks.

The acquisition aligns with Iberdrola’s growth strategy centred on electricity networks businesses, with the company managing 1.4 million kilometres of power lines in the US, the UK, Brazil, and Spain.

This July, Iberdrola completed a capital raise of €5bn to support its grid investments in the US and UK.

This capital raise resulted in the issuance of 331 million new shares through an accelerated bookbuilding process, which was 3.8 times oversubscribed.

The offering was priced at €15.15 per share, making it the largest accelerated bookbuilding exercise in Spain since the €7.5bn raise by Santander in 2015.