Mexia is confident about the outcome of the takeover bid on EDP Renováveis

  • ECO News
  • 4 May 2017

EDP's CEO is confident about the outcome of the takeover bid on EDP Renováveis. Mexia predictions are that the operation could be registered over the next weeks.

EDP‘s CEO is confident about the outcome of the takeover bid on EDP Renováveis, in spite of the objections made to the price offered by the company headed by Manso Neto.

António Mexia, in a phone conversation with analysts after the presentation of the results of the group, guaranteed that the takeover bid “will bear no surprises”, states this Wednesday Jornal de Negócios. Mexia also said he awaits an offer which could be registered in the CMVM (Portuguese Securities Market Commission) over the next few weeks. “We hope the complete registration occurs in one or two weeks. If it all goes according to plan”, he added.

In that same conversation, the CEO of the Portuguese electric company refused to disclose what he would do with the money allocated for the operation in case the offer is not successful.

“In all our movements we have been keeping the balance between growth and deleveraging“, he later stated, adding that EDP “is fully committed” to reducing their debt on EBTIDA to three times in 2020.

EDP‘s offer on EDP Renováveis is 6.80 euros per share, decreasing to 6.75 euros after paying 1,300 million euros worth of dividends.

EDP Renováveis‘ board of directors said, on April 26, that considered the price to be adequate. “The board of directors believes that, notwithstanding the quid pro quo offered by EDP which may not fully reflect the potential value of the company on the long term, the price of the offer is what we consider to be adequate“.

Yet, not all investors agree with the proposal. The North-American assets manager MFS Investments considers the price EDP wants to offer the minority shareholders from EDP Renováveis is not fair: in a letter sent to EDP‘s administration, they believe there is room to improve the offer.