China Development Bank provides $48,800,000 loan to State Grid Brazil Holding S.A. in September 2012

Project narrative

In September 2012, China Development Bank provided a $48,800,000 loan to State Grid Brazil Holding S.A. for its subsidiary Serra Paracatu Transmissora de Energia S.A. (SPTE). According to page 6 of the report released by State Grid Corporation of China, the loan has an interest rate of LIBOR + 2.85% (Sep. 2012 6 month average LIBOR + 2.85=3.522%). The period of maturity is 12 years with payments of principal and semi-annual interest. In 2014, State Grid International Development Co. Ltd (SGID), as guarantor, settled the entire outstanding balance in one total amount of $43,260,012 on behalf of the company. By way of background, in December 2010, State Grid Corporation of China acquired 100% stakes in seven Brazilian transmission concession companies through its wholly owned Brazilian subsidiary, State Grid Brazil Holding S.A. (“SGBH”), each with a secured 30-year operating right. The assets in these companies at the time of acquisition included transmission lines with a total length of 3,176 km, six 500 kV substations, two 500 kV switching stations and one 345 kV substation. SGBH assumed responsibility for operating these 7 transmission companies. Then, in May 2012, SGBH entered into an agreement to acquire another seven Brazilian transmission concession companies, each with a secured 30-year operating right. The seven companies’ assets at the time of acquisition included transmission lines with a total length of 2,792 km, 11 self-owned substations and 12 substations jointly controlled with others. These activities and other electricity transmission projects — including the 2,518 km Belo Monte ±800 kV UHVDC Transmission Project (or 巴西美丽山水电特高压直流送出二期项 or ±800千伏特高压直流输电工程) — have been supported by China Development through a series of loans.