Colombia’s government has postponed the sale of its majority stake, up to $3 billion, in the power generation company Isagen for as long as a year, international media reports.
The delay is aimed at attracting more bidders, which would increase competition and drive up the price while giving potential buyers time to evaluate their options, according to news wire agency Reuters.
“For the nation, it’s desirable to have various interested parties that will compete (in the auction), and we will be able to sell at the best value possible. For that reason we won’t rush. What we need is competition so we won’t do this under pressure,” said Colombia’s Finance Minister Mauricio Cardenas.
When the privatization was first announced, seven international companies showed interest in buying the government-owned company. That number has slowly dropped, and now only three companies are registered as possible buyers, according to The Wall Street Journal.
MORE: Foreign companies ‘most likely’ to buy Colombia’s stake in energy giant Isagen
The Colombian government owns 58% of the stakes in Isagen, which could generate up to $3 billion. The privatization of the energy company is an attempt at raising funds to finance infrastructure across the country.
“The plan is to transform this valuable asset, Isagen, into highways, which is what is in the national interest,” said Cardenas.
MORE: Colombia seeks to sell Isagen stake, hopes to generate $2.4B for infrastructure
The stakes were scheduled to be on auction August 22. Since the 1990’s, several of Colombia’s presidents have talked about or have actively tried to sell the Isagen stakes.
The foreign companies interested in Isagen are China’s Huadian Corporation, Spain’s Gas Natural, and Duke Energy from the US, according to Reuters.
Sources
- Colombia delays privatization of power utility Isagen (Reuters)
- Colombia Postpones $2.6 Billion Privatization Sale of Isagen (The Wall Street Journal)