Enel Green Power International (EGPI) has agreed to sell 60% of stake in Enel Green Power España (EGPE) to Endesa Generación for €1.2bn.
Endesa already holds 40% of the stake in EGPE, which operates directly or indirectly via subsidiaries in the generation of electricity from renewable resources in Spain.
As of 31 December 2015, EGPE directly and indirectly operated a portfolio of plants which have a consolidated installed capacity of around 1.7GW, of which 95% are wind farms.
Enel said the transaction is consistent with its strategy of rationalising and simplifying its operational structure in the several countries where it has operations.
Also, with this transaction, Endesa can expand its presence in renewable sector in the Iberian Peninsula, where most of EGPE’s skills are concentrated.
For determining the price of the transaction, the boards of directors of both the companies adopted valuation techniques commonly used internationally and have taken the advice of prominent financial advisors, who gave their fair opinions on the transaction.
Apart from this, in compliance with Spanish legislation, Endesa’s board of directors have also approved the transaction following a favourable opinion of the Comité de Auditoria y Cumplimiento and solely through the vote of the independent directors.
Enel said the transaction will not have an impact on the group’s consolidated financial statements, from an accounting stand point. It says that the transaction was carried between companies under common control.
Image: Enel headquarter building in Rome, Italy. Photo: Courtesy of Blackcat/Wikipedia.