REN makes a share capital increase to acquire EDP’s gas unit

  • ECO News
  • 10 April 2017

After the sale of Naturgas in Spain, EDP has now sold EDP Gas to REN, which will make a 250 million euros' capital increase to finance the operation.

REN acquired EDP‘s natural gas activity, in an operation which assesses EDP Gás at 532.4 million euros, stated the Portuguese electrical network manager to the CMVM. In order to finance that operation, the company headed by Rodrigo Costa announced a share capital increase of 250 million euros, as a part of a financing structure which also includes credit facilities.

REN – Redes Energéticas Nacionais hereby informs to the market and the general public that its subsidiary REN Gás entered into a purchase agreement with EDP for the acquisition of the entire share capital of EDP Gás and its subsidiaries, EDP Gás Distribuição, and EDP Gás GPL – Comércio de Gás de Petróleo Liquefeito“, REN informed, while adding the operation does not include any natural gas supply activities.

"This transaction presents a unique opportunity for REN to achieve a further integration in core domestic natural gas infrastructure. The transaction also maintains REN’s strong financial and credit profile.”

REN

CMVM

“For this reason, the natural gas last resort supplier – EDP Gás, Serviço Universal, S.A. – will be carved out of the current EDP Gás perimeter before completion”, REN states. The operation gives EDP Gás, which holds the second largest gas distribution network in Portugal (4,640 km), an enterprise value of 532.4 million euros.

In order to finance this operation, the administration headed by Rodrigo Costa approved a funding structure which includes credit facilities and a share capital increase via new cash contributions, “subject to the approval by REN’s relevant corporate bodies”. The Portuguese electric network manager explains: “Such share capital increase will be implemented through a rights issue with estimated proceeds of up to € 250 million”.

“This transaction presents a unique opportunity for REN to achieve a further integration in core domestic natural gas infrastructure. The transaction also maintains REN’s strong financial and credit profile”, states REN, adding the acquisition is subject to certain precedent conditions, “including customary regulatory approvals”.

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