MILAN – Energy Infrastructure Partners (EIP), the Swiss asset manager, will up its stake in Eni’s Plenitude unit to 10%, in a deal that values the group’s retail and renewable business at more than 10 billion euros ($11 billion) including debt.
In a statement on Monday, the Italian energy group said EIP had agreed to subscribe to a new share issue worth around 209 million euros.
The deal is part of Eni’s ‘satellite’ strategy, aimed at creating separate units capable of attracting investments to grow their businesses. Eni’s Chief Transition and Financial Officer Francesco Gattei said the group believed this was the right approach to the energy transition.
“We have embarked on a virtuous path of creating low and zero-carbon businesses that attract leading investors, grow organically, and become self-sustaining,” Gattei said in the statement.
Under its ‘satellite’ strategy, Eni (NYSE: E) has partnered with U.S. investment firm KKR (NYSE: KKR) which invested 2.94 billion euros in the group’s biofuel unit Enilive to take a stake of 25%.
The Italian group is also in talks with several potential investors, including Italian gas grid operator Snam, interested in becoming partners in its carbon capture and storage business (CCS).
Analysts at Italian brokerage Equita said Monday’s announcement had positive implications for the stock, adding the deal implied an enterprise value for Plenitude of around 10 times its core earnings, higher than a multiple of three for the whole energy group.
Shares in Eni were down -0.13% at 1516 EST.
Switzerland’s EIP first invested in Plenitude in March, buying a 7.6% stake for 588 million euros and saying it would consider later raising its holding.
“Our decision to increase the size of our investment reconfirms our strong belief in the value of the business, the excellence of Plenitude’s entire organization and leadership team, and the company’s ability to deliver in line with its strategy and business plan,” EIP partner Tim Marahrens said.
Rothschild advised EIP, while Mediobanca advised Eni.
Plenitude generates power from renewable sources with an installed capacity of over 3 gigawatts (GW), it sells gas and electricity to 10 million customers and has a network of 21,000 charging points for electric vehicles.
By 2027, the company aims to reach over 11 million customers, more than 8 GW of renewable capacity, and 40,000 charging points installed in Italy and abroad.
($1 = 0.9332 euros)
(Source: Reuters)
Energy Infrastructure Partners Eni
