Brazil's Eletropaulo to raise $500 mln for investment, pay debt

SAO PAULO, March 22 (Reuters) - Brazil's Eletropaulo , the country's largest power distribution company, plans to raise $500 million for investments and debt repayment, according to documents seen by Reuters on Thursday.

The company, whose two largest shareholders are Brazil's development bank BNDES and U.S. power company AES Corp, plans to set up a subsidiary abroad as a vehicle to tap international capital markets, according to documents the firm sent to Brazil's power sector regulator, Aneel.

Eletropaulo needs Aneel's authorization to establish the subsidiary, which would issue the bonds and send the proceeds to the parent company in Brazil.

"Once capitalized, Eletropaulo would use the proceeds to fund investments in power distribution and to pay back debt," said the company in the document requesting permission to set up the subsidiary.

Eletropaulo replied to an inquiry from Reuters regarding the plan saying "there was no definition, at this time, regarding the transaction."

According to the documents, the company expects to amortize around 1 billion reais ($303.29 million) in debt by 2019 if the capitalization plan goes ahead.

($1 = 3.2972 reais) (Reporting by Luciano Costa Writing by Marcelo Teixeira; Editing by Dan Grebler)