João Lourenço ordered the removal of the Empresa Nacional de Distribuição de Electricidade, an Angolan National Power Distribution Company (ENDE) from the partnership with Isabel dos Santos at Efacec Power Solutions, the businesswoman told VALOR.
“We were notified that the President of the Republic had issued instructions to the Ministry of Energy and Water for ENDE’s removal from Efacec. ENDE’s shares will be sold on the international market,” she stated.
Isabel dos Santos reaffirmed that the company had not been acquired with public funds, instead asserting that she had put forward the money to enable ENDE’s entry.
“Efacec was bought for €195 million and ENDE cost €16 million, so how did the State pay?” dos Santos asked, adding that “each shareholder had to do their part and pay for their shares”.
“Supposedly, with the 40% Winterfell capital, ENDE was to pay €40 million, but only paid €16 million. The full amount was never paid. Isabel dos Santos had to put forward the rest of the money for ENDE to enter the business and own the shares,” she continued.
“Despite this weak partnership, Efacec came back to life and is now a global reference in energy and engineering. Certain sectors must be having a hard time accepting Isabel dos Santos’ success,” she concluded.
The businesswoman said that the partnership “had everything it needed to be a happy marriage,” given that “ENDE would have access to the leading energy and engineering talent,” and there was also “the project to build a transformer and electrical cable factory in Angola next year, thereby transferring know-how and creating 300 new skilled jobs.”
Winterfell holds a 66.07% stake in Efacec, which in 2017 witnessed a 75% profit growth, to €7.5 million.
It’s not the first time dos Santos has affirmed that the Efacec purchase “was not directly or indirectly State-funded and did not receive any form of Angolan public financing.”
Suspicions that State funds were involved date back to August 2015 following a presidential decree authorizing ENDE’s purchase of a 40% stake in Winterfell, which around three months prior, had formalized the purchase of Efacec Industrial. The misgivings were fueled by the fact that the value ENDE had paid for the holding was unknown, with some suspecting that it was all or most of the amount invested in the Efacec purchase.
At the time, some Portuguese lawmakers asked the national authorities to check if anti-money laundering rules had been followed.
The Portuguese-founded company’s business relationship with Angola dates back to the 1960s. Major contracts have been concluded in recent years, such as the project formalized in 2014 to upgrade and increase the capacity of a hydropower plant at the Luachimo dam, with a duration of 37 months and valued at around $83 million. That year, then company director José Cabral Costa estimated the company’s turnover at around $100 million in Angola. They also have a contract with the Laúca dam, which in 2017 produced a split-phase power transformer with a power output of 371 MVA and voltage levels of 400/18 kV.