SAO PAULO--Brazilian courts ruled that AES Eletropaulo
(ELPL4.BR) will have to pay a government-controlled utility 1.3
billion Brazilian reais ($624 million) to zero out a loan that was
granted to the Brazilian unit of AES Corp. (AES) when it was still
state-controlled, Eletropaulo said Friday.
The court found that Eletropaulo was responsible for full
repayment of the balance of the loan, which was granted by federal
utility Centrais Eletricas Brasileiras, or Eletrobras (ELET6.BR),
to Eletropaulo in 1986. At the time the company was controlled by
the state government of Sao Paulo, which later broke up and
privatized the company's assets. Those assets were taken over by
AES and by CTEEP (TRPL4.BR), owned by Colombia's Interconexion
Electrica SA (ISA.BO).
The courts ruled that CTEEP didn't have to pay Eletrobras, and
that Eletropaulo was solely responsible for repayment, Eletropaulo
said in a regulatory filing. Eletropaulo estimates that the
outstanding amount is about BRL1.3 billion.
Eletropaulo is appealing the court decision and said "our legal
advisors estimate that the company has good chances in the
appeals," adding that "at this moment the judicial decision has no
impact on the company's earnings."
Write to Paulo Winterstein at paulo.winterstein@dowjones.com
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