The joint venture between Gerdau and Shell, after Cade's approval for its creation, will be responsible for investments and exploration in the solar energy market in Brazil, with the main focus on the solar park located in Minas Gerais.
Last Friday (01/06), the General Superintendence of the Administrative Council for Economic Defense (SC/Cade) approved the creation of a joint venture between Gerdau and the company Heze I Holding SA, owned by Shell. In this way, the new company formed with the union of both will be responsible for the exploration of an energy generation park solar energy in Janaúba, Minas Gerais, with a focus on expanding the market in Brazil.
Joint venture between Gerdau and Shell will be essential for the company's focus on the solar energy market, taking advantage of the growth in the national territory
Brazil has become a world leader in the use of solar energy as an alternative and renewable energy source and, over the last few years, several companies have been investing in the segment in the national territory. Now, it is Gerdau's turn to apply its resources to take advantage of the high potential for generating the resource in Brazil, through investment in the creation of a joint venture with Shell.
Gerdau operates in the Brazilian market strongly linked to and focused on the electricity sector, with a large portfolio of steel production for use in industries and economic sectors, such as civil construction, automotive, agriculture, energy, industrial and manufacturing.
Shell is a multinational group operating in the oil, natural gas and fuel market worldwide, in addition to being widely present in the manufacture and sale of chemical products with the market focused on the generation and sale of energy.
Thus, although they have somewhat different focuses in the international market, the companies have a strong common interest and have been focusing on it in recent years, power generation. Therefore, the creation of a joint venture between them will result in a new company highly linked to the renewable market, such as solar energy.
Thus, the company will have as its main focus the application of investments in the Brazilian territory, since the country is a world reference in the use of the sun for the production of energy, and will be largely responsible for the exploration of a solar energy generation park in Janaúba, Minas Gerais.
Cade approved the development of a joint venture between the companies without restrictions as the union does not pose risks to the solar energy market in Brazil
Cade's final opinion in support of the creation of a joint venture between Shell and Gerdau for the exploration of a solar energy generation park in Janaúba, Minas Gerais, was largely motivated by the lack of evidence of risks to the energy market in Brazil.
This happens because the companies have low participation in the analyzed markets, with different focuses so far in the Brazilian territory.
Thus, Cade's General Superintendence carried out surveys and proved that the market shares held by the Shell Group and the Gerdau Group in the generation of the energy electricity in Brazil is less than 10%. The energy commercialization branch is also not so linked to the companies and, therefore, Cade does not believe that there could be a market concentration or strong influences in the supply and demand processes.
If Cade's Court does not call for a vote against the process of merging the companies, within a final period of 15 days Shell and Gerdau will be able to proceed with finalizing the creation of the joint venture and should start investing in the solar energy market in Brazil soon.
