Enel suspends sale of Edesur amid Milei optimism

Italian energy giant Enel SpA confirmed Monday it’s suspended the sale of subsidiary power distributor Edesur in Argentina as company executives become hopeful about President Javier Milei’s push to deregulate the sector, according to a company spokeswoman.

Enel officials, including Chief Executive Officer Flavio Cattaneo, met with Cabinet Chief Nicolás Posse and Economy Minister Luis Caputo Monday in Buenos Aires, where they applauded Milei, who took office December 10, for his push to deregulate Argentina’s energy industry, according to statements from the government and Enel’s spokeswoman.

Enel becomes the first major multinational to pivot its strategy in Argentina based principally on Milei’s shock therapy economic plan. The company had already sold two subsidiaries before deciding to hold off on selling Edesur as the libertarian president pledged to scrap generous subsidies and price controls that translated into losses for the company. Edesur would become more valuable if it can charge customers higher rates on electricity in Argentina.

Enel’s support for Milei’s pro-market approach comes days after Argentina’s senate voted to overturn his decree from December that deregulates aspects of the country’s energy sector, among other measures. The decree still stands until the lower house of Congress votes on it, which doesn’t have a date set. Milei also pulled his major bill of reforms from the legislature when lawmakers started to vote it down article by article, raising investor concerns about his legislative strategy.