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Subsequent events
 12 Months Ended
Dec. 31, 2022
Subsequent Events  
Subsequent events

 

40.Subsequent events
40.1Acquisition of Aventura and Santa Rosa & Mundo Novo Wind Complexes

On January 30, 2023, Copel GeT completed the acquisition of 100% of the shares of companies belonging to the Aventura and Santa Rosa & Mundo Novo Wind Complexes shown in the table below, with payment of R$1,005,173 to the seller, EDP Renováveis Brasil S.A. At the transaction closing date, the shares were transferred to Copel GeT, and the appointment and investiture new managers of the Companies were approved.

 
   
Santa Rosa & Mundo Novo Wind Complex  Aventura Wind Complex
SRMN Holding S.A.  Aventura Holding S.A.
Central Eólica SRMN I S.A. Central Eólica Aventura II S.A.
Central Eólica SRMN II S.A. Central Eólica Aventura III S.A.
Central Eólica SRMN III S.A. Central Eólica Aventura IV S.A.
Central Eólica SRMN IV S.A. Central Eólica Aventura V S.A.
Central Eólica SRMN V S.A.  

The acquisition is in line with the sustainable growth strategy in renewable energy, expanding the generation matrix diversification in line with the Company’s Strategic Planning and Investment Policy. The transaction includes the Locked box mechanism, in which all cash generated from January 1, 2022 to the closing date will remain in the cash of the acquired Companies.

Transaction closing was subject to the satisfaction of certain conditions precedent, which were fully complied with by January 30, 2023, including: obtaining approval from the Brazilian Antitrust Enforcement Agency (CADE), declarations and guarantees, compliance with covenants and obligations, third-party consent, absence of material adverse effect.

It is also important to highlight the need for unconditional and unrestricted consent from counterparties to change the control of the acquired Companies, including regarding credit limits for maintenance of financing agreements by the Companies, in accordance with National Monetary Council (CMN) Resolution No. 4995, of March 24, 2022, a condition that was only fulfilled in January 2023.

The complexes are located in the state of Rio Grande do Norte, the largest wind energy hub in the country, and have a 260.4 MW installed capacity, with 157.8 MWm of assured energy. The companies have long-term financing (maturities up to 2043) taken out from Banco do Nordeste - BNB, at IPCA rates + 2.19% p.a. (Aventura Complex) and IPCA + 1.98% p.a. (Santa Rosa & Mundo Novo Complex).

The seller is developing projects in the vicinity of the Aventura Complex wind farms which, during construction and/or operation, may potentially affect the volume of electricity generated by the wind farms (wake effect) in the future. The seller estimates that these undertakings may start up operations as of January 2027. If the wake effect materializes so that the acquired wind farms generate energy below what was agreed between the parties, the seller will have the obligation to indemnify Copel. Otherwise, if the energy generation is greater, Copel must indemnify the seller. The amount of this indemnification is limited to R$4,167 for both situations, monetarily restated.

The tables below show the book value and fair value of the net assets acquired, including the effect of deferred taxes (technical goodwill). The fair value was determined based on a preliminary purchase price allocation (PPA) report. Therefore, information is under review and may change. However, no significant changes are expected.

        
 Aventura Wind Complex    Fair value Fair value at the
  Book value adjustment acquisition date
Assets identified 518,158 255,675 773,833
Cash and cash equivalents  51,789 -  51,789
Trade accounts receivable  7,150 -  7,150
Recoverable taxes  3,823 -  3,823
Other receivables  2,917 -  2,917
Property, plant and equipment 452,475 - 452,475
Intangible assets  4 255,675 255,679
Liabilities assumed 330,102  93,002 423,104
Suppliers  6,950 -  6,950
Loans and financing 317,928 - 317,928
Tax obligations  2,879 -  2,879
Other accounts payable  2,345 -  2,345
Contingent Liabilities -  9,891  9,891
Deferred income tax and social contribution  -  83,111  83,111
Net assets acquired 188,056 162,673 350,729
       

 

       
 Santa Rosa & Mundo Novo Wind Complex    Fair value Fair value at the
  Book value adjustment acquisition date
Assets identified 840,938 366,360  1,207,298
Cash and cash equivalents  67,440 -  67,440
Trade accounts receivable  23,961 -  23,961
Recoverable taxes  5,747 -  5,747
Other receivables  9,157 -  9,157
Property, plant and equipment 734,633 - 734,633
Intangible assets - 366,360 366,360
Liabilities assumed 625,811 131,100 756,911
Suppliers  56,611 -  56,611
Loans and financing 557,810 - 557,810
Tax obligations  7,579 -  7,579
Other accounts payable  3,811 -  3,811
Contingent Liabilities -  10,155  10,155
Deferred income tax and social contribution  - 120,945 120,945
Net assets acquired 215,127 235,260 450,387

 

Contingent liabilities mainly refer to tax risks for which management believes that providing information regarding the timing of any cash outflows is impracticable, in view of the unpredictability and dynamics of the Brazilian legal, tax and regulatory systems. A final outcome depends on the conclusions of legal proceedings.

The table below shows the consideration transferred for assets acquired and technical goodwill calculated as a result of the recognized deferred tax liability in the business combination:

       
Total of net assets acquired 403,183 397,933 801,116
Goodwill     204,057
Consideration amount      1,005,173

 

40.2Technical Inspection at HPP GBM

On March 25, 2023, the scheduled stoppage for inspection of the generating unit 3 of HPP GBM, a plant belonging to FDA, subsidiary of Copel GET, was concluded. An isolated fault was identified in the upper wear ring of the turbine rotor, so that this generating unit will remain unavailable to carryng out a diagnosis on the cause of the incident and the respective actions for its repair, when the return forecast for this generating unit will be updated. Eventual financial impacts related to non-generation or any reduction in the plant's assured energy can only be estimated after the completion of this work.