CPFL Energia S.A. through its subsidiary CPFL Comercialização Brasil S.A. has entered into an agreement with a consortium of companies to acquire 100% of the quotas of Jantus SL and to potentially acquire another company to be organized by the consortium through a corporate reorganization in Jantus.

The consortium includes Liberty Mutual Insurance Company, Citi Participações e Investimentos Ltda, an investment fund managed by Black River Asset Management LLC, Carbon Capital Markets Limited, which holds its interest in Jantus on behalf of its parent company Trading Emissions PLC, Matthew Alexander Swiney, and other minority shareholders in Jantus SL.

Wilson Ferreira Jr, CEO of CPFL Energia said the acquisition of SIIF further consolidates the firm’s strategy to grow in generation mainly through renewable sources of energy.

However, according to Adriana Waltrick, VP of Business Development of CPFL Energia, the firm is enthusiastic about this transaction given the high quality of SIIF's assets and its growth potential through development of new wind power plants.

Currently, Jantus owns SIIF Energies do Brasil Ltda., and SIIF Desenvolvimento de Projetos de Energia Eólica Ltda. (together “SIIF”). SIIF owns four wind farms in operation (Formosa, Icaraizinho, Paracuru and SIIF Cinco) located in the State of Ceará, with a total installed capacity of 210 MW and 20-year power purchase agreements (PPA) with Eletrobras.

SIIF also owns a wind farm project located in the State of Rio de Janeiro with a potential installed capacity of 135 MW and also with a long-term PPA with Eletrobrás. In addition, SIIF has a portfolio of several wind farms projects with total potential installed capacity of 732 MW in the States of Ceará and Piauí out of which 412 MW are already certified and eligible for participation in upcoming energy auctions.

Jantus will be reorganized so that it indirectly owns all projects and operating assets owned by its subsidiaries other than Quintanilha Machado, which will become a subsidiary of Jantus II, and whose purchase is subject to certain conditions precedent.

The acquisition price for Jantus (comprising Wind Farms in Operation and the Projects Portfolio) is R$ 950 million, in addition, the consortium will assume a net debt of R$ 544.2 million. The conditional acquisition price of Jantus II is R$ 70 million with no assumption of debt. Once both transactions are completed, they represent a combine Enterprise Value of R$ 1,564.2 million.

The values above will be adjusted based on the amount of net indebtedness and working capital of Jantus and Jantus II at closing. The closing of both transactions are subject to certain conditions as per the SPA, including the approval by all required regulatory authorities.

12th April 2011