Spanish energy company and European transmission system operator (TSO) Enagás has agreed to divest its 30.2% stake in the American energy infrastructure company Tallgrass Energy to Blackstone Infrastructure Partners for around $1.1bn.

The move is part of Enagás’ asset rotation process announced in its 2022-2030 strategic plan. The plan focuses on decarbonisation and security of supplies in Spain and Europe.

Through the transaction, Enagás aims to bolster its balance sheet and enable the company to implement its investment plan in renewable hydrogen infrastructure. The plan is included in the European Union (EU)’s list of projects of common interest.

Notably, the Royal Decree-law 8/2023 designates Enagás as the provisional manager of the Hydrogen Backbone Network.

Upon its closing, the deal is estimated to generate an accounting loss in this year’s income statement of about €360m. The divestment is also expected to have a very positive impact on the company’s cash flow statement.

Besides, the deal also supports the company’s dividend policy and its long-term sustainability.

Enagás will receive $50m of the total agreed consideration after the receipt of an ongoing administrative authorisation.

The transaction is anticipated to be completed at the end of this month.

As part of the company’ asset rotation process, Enagás has executed other sales transactions including its participation in GNL Quintero terminal in Chile along with the Morelos gas pipeline and the Soto La Marina compression station in Mexico.

Separately, the Spanish company has acquired an additional 4% in Trans Adriatic Pipeline (TAP) and entered into the Hanseatic Energy Hub consortium (HEH).