Dec. 6 (Bloomberg) — ERG SpA surged the most in six months
in Milan trading after agreeing to buy wind-energy assets from
GDF Suez SA, striking a 859 million-euro ($1.1 billion) deal
that makes it Italy’s largest wind-power producer.
The shares rose as much as 7.1 percent, the biggest gain
since May 25, and traded up 5.6 percent at 5.90 euros as of 2:54
p.m. local time.
ERG will pay 28.2 million euros for 80 percent of GDF
Suez’s IP Maestrale Investments unit, which has 636 megawatts of
wind power in Italy and Germany, the Milan-based company said in
a statement late yesterday. The enterprise value of the
transaction, including debt and equity, is 859 million euros.
“It is a good price because on average I’m evaluating the
ERG Italian assets at 1.5 million euros per megawatt,” said
Claudia Introvigne, an analyst at Kepler Capital Markets in
Milan who recommends buying the stock.
As well as becoming Italy’s largest wind-power producer,
ERG is gaining entry to the German market at a time when
Chancellor Angela Merkel’s government is promoting renewable
energy to help fill a gap left by nuclear-plant shutdowns.
The GDF Suez wind farms are funded through so-called non-
recourse project finance, whereby the lender can recoup payments
from the ventures’ profits. The debt, provided by Italian and
international banks, matures in December 2022, according to ERG.
The assets in Italy include 161 megawatts in Sicily, 111
megawatts in Sardinia and 95 megawatts in Campania, as well as
projects in Basilicata, Puglia and Molise. The 86 megawatts in
Germany are in central and northern regions.
The transaction, which leaves GDF Suez with the remaining
20 percent of shares, will help the Paris-based utility reduce
net debt by 800 million euros, it said in a separate statement.
The agreement, subject to approval, includes a put and call
option on GDF Suez’s 20 percent equity, exercisable from three
years after deal completion, which is expected early next year.
To contact the reporter responsible for this story:
Sally Bakewell in London at
Sbakewell1@bloomberg.net
To contact the editor responsible for this story:
Reed Landberg at
landberg@bloomberg.net
