The Brazilian infrastructure group Equipav has been showing a strong appetite for expansion, including through contracts in Argentina.
Recently, a consortium with participation by Equipav submitted the best offer for the purchase of the Argentine water and sanitation company AySA.
The operation represents, so far, the largest privatization carried out by Javier Milei’s government in Argentina and highlights the Brazilian group’s interest in expanding its activities.
In Brazil, Equipav already has a significant presence in the sanitation and highways sectors.
Currently, the company controls a 50% stake in Aegea, a Brazilian sanitation company whose shareholders also include Singapore’s sovereign wealth fund GIC and the Itaúsa holding company.
A Aegea is a leader in the private sanitation segment in Brazil. The company is present in 893 municipalities across 15 states: Amazonas, Ceará, Espírito Santo, Maranhão, Mato Grosso, Mato Grosso do Sul, Pará, Paraná, Piauí, Rio de Janeiro, Rio Grande do Sul, Rondônia, Santa Catarina, Minas Gerais, and São Paulo.
Founded in 2010, the company currently holds 37% of the private sanitation market and serves more than 39 million people.
In the highway sector, Equipav holds a 50.1% stake in EPR, a concessions platform whose partner is the asset manager Perfin, with the remaining 49.9%.
Currently, EPR manages seven highway concessions in the states of Minas Gerais and Paraná. In Minas Gerais, it operates the EPR Triângulo, EPR Sul de Minas, EPR Vias do Café and EPR Via Mineira concessions. In Paraná, it manages EPR Litoral Pioneiro, EPR Iguaçu and EPR Paraná.
Equipav also controls Germina Brasil, which is responsible for a concession in the Baixio do Irecê region, in Bahia. The project covers a total area of 105 thousand hectares, of which around 48 thousand are suitable for full irrigation.
Originally divided into nine stages, the project already has stages 1 and 2 in operation and in the occupancy phase. In June 2022, through a public auction, Germina Brasil won the concession for stages 3 to 9, which total approximately 50 thousand hectares, of which 31.5 thousand hectares are irrigable.
Over the 35 years of the concession, investments of 1.5 billion reais (US$300 million) are planned for the project, with the potential to generate 180 thousand direct and indirect jobs.
The expansion in Argentina is taking place in parallel with the group’s growth process in Brazil.
According to executives familiar with the company’s plans, consulted by BNamericas on condition of anonymity, Equipav is assessing new highway concession opportunities through EPR.
In the medium term, the group is also considering the possibility of listing its sanitation and highway subsidiaries in the country.
In Aegea’s case, expansion plans have become more selective in recent months. This happened after a period of rapid growth in sanitation operations in Brazil, which also resulted in an increase in the company’s indebtedness.
(The original version of this content was written in Portuguese)