Sao Paulo could sell Cesp to Furnas – report

* State seeks sale of Cesp to federally-owned Furnas

* Sale would hinge on concession renewal of two Cesp dams

SAO PAULO, Jan 11 (BestGrowthStock) – The Sao Paulo state government
could sell its stake in energy generator Cesp (CESP6.SA: ) to
federally-owned Furnas to raise funds for investments, Folha de
S. Paulo newspaper said on Tuesday, citing a state official.

State Energy Secretary Jose Anibal will meet with officials
from President Dilma Rousseff’s administration in January to
discuss a possible sale, the daily said. Among possibilities are
the sale of the state’s entire stake or part of it, in exchange
for renewing concessions for two of Cesp’s largest power dams,
Anibal told Folha.

“There are a series of possibilities,” Anibal told the
daily. “Our interest is first to extend the concessions’
deadline.”

Cesp, Brazil’s third -biggest power generator, owns six
power dams with a combined output capacity of 7,456 megawatts of
electricity, Folha said. Its two biggest dams, Ilha Solteira and
Jupia, account for two thirds of capacity and have concessions
ending in 2015, the paper added.

Sao Paulo state controls 41 percent of Cesp’s shares,
including 95 percent of its voting stock.

The company had been scheduled for privatisation since late
1990s but a Brazil-wide power shortage and subsequent rationing
in 2001 delayed the plans. Sao Paulo state’s most recent plan to
sell its stake in the utility in 2008 was cancelled because of a
slump in equity markets.
(Reporting by Elzio Barreto; Editing by Greg Mahlich)