Exclusive: Batista brothers’ J&F in discussions for EDF plant amidst increasing mergers and acquisitions in Brazil’s power sector.

J&F Investimentos SA, the holding company affiliated with Brazil’s influential Batista brothers, is in discussions to purchase EDF’s thermal plant in Rio de Janeiro, as revealed by two anonymous sources familiar with the situation.

According to one insider, the deal may amount to as much as 2 billion reais ($374 million) and has attracted the attention of other potential buyers. The negotiation process, led by Bank of America, is in its initial phases, with J&F yet to submit a definitive bid.

These talks form part of a broader trend of heightened merger and acquisition activity within Brazil’s energy sector this year, with prominent players like Brookfield from Canada and Engie from France rumored to be contemplating significant deals.

In response to inquiries regarding the potential sale of its Norte Fluminense plant, EDF disclosed that it is contemplating an initial public offering (IPO) for its North American and Brazilian subsidiaries. This move aligns with EDF’s ten-year strategic plan to enhance its portfolio’s growth and long-term investment capabilities on a global scale.

As part of its strategic realignment efforts, EDF is exploring options to divest its Brazilian assets while streamlining its international presence and offloading non-core holdings to concentrate on domestic nuclear ventures.

The thermal plant in question currently operates without long-term buyer contracts, making it an attractive prospect for J&F, which specializes in rehabilitating underperforming assets. Ambar Energia, the power company under J&F’s umbrella, already manages several plants without long-term agreements.

Aside from its interests in the energy sector through Ambar Energia, J&F, which also controls the renowned meatpacker JBS, has been actively expanding its presence in the market. Recently, the group put forth an offer to acquire Roraima Energia, a power distribution company in Brazil’s northern region owned by the Oliveira Energia conglomerate.

Although a preliminary agreement was reached with Oliveira Energia last year to assume control of the power distribution firm in Amazonas, the transaction has yet to be finalized. J&F and Bank of America have refrained from providing official statements on the matter.