GDF Suez, Duke Energy in talks to merge Latin American assets

French energy giant GDF Suez is reportedly in talks to merge its Latin American assets with US-based utility major Duke Energy Corp, Brazilian newspaper, Valor Economico today reported.

The talks could include GDF Suez buying all the Latin American assets of Duke Energy or merging the two company's Latin American operations in a deal, where GDF Suez would own 60 to 70 per cent of the new company and the remaining by Duke Energy, the Sao Paulo-based paper said, citing sources close to the matter.

The company would have a combined capacity of 15,000 megawatts and create a power generator worth an estimated 30 billion reais ($18.8 billion).

Paris-based GDF Suez, the world's second-largest power utility company that was formed through the merger of Gaz de France and Suez in 2008, (See: Suez, GDF shareholders agree to $159-billion merger) is the largest gas supplier in Europe and amongst the world's biggest electricity producers.

The company, which is 35-per cent owned by the French government, generates electricity from wind, biomass and bio gas, hydro, natural gas, coal, nuclear, and other non-renewable sources, and involves in energy procurement and trading business.

GDF Suez, which has a market value of approximately €70 billion, had 2010 revenues of €84.5 billion and net income of €4.6 billion. Although it operates in all the continents, 80 per cent of its revenues come from Europe.

North Carolina-based Duke Energy is an S&P 500 component and the third-largest utility company in the US. The energy major has a generation capacity of over 35,000 MW in the US and a customer base of around 4 million. In addition, the company has more than 4,000 MW of generation capacity in Latin America.

Duke Energy employs over 18,600 people, and its 2010 net profit was $1.3 billion on revenues of $14 billion.