E.ON to Sell Hydroelectric Plants for $1b

E.ON to Sell Hydroelectric Plants for $1b

Italian energy group ERG is to buy German utility E.ON's Italian hydroelectric power plants for about $1 billion, expanding its renewable portfolio which mostly comprises wind farms.

E.ON's Terni Hydroelectric Complex, which has 527 megawatts of generating capacity and produces about 1.4 terawatt hours of electricity a year, was put up for sale in late 2013 along with other assets in the country.

ERG currently operates wind farms in Europe with a total capacity of 1.38 gigawatts, including 1.1 gigawatts in Italy, as well as a gas-fired thermal plant in Sicily with a capacity of 480 MW, Reuters reported.

Through the acquisition, whose 1-billion-euro price tag is in line with what sources familiar with the matter said earlier this year, the former oil refiner continues its transformation into becoming a specialized renewable energy company.

"The acquisition will enable a significant improvement in our economic results and cash generation in the medium term," ERG Chief Executive Officer Luca Bettonte said in a statement.

The acquisition comprises 16 hydro plants, one pumping station, seven large dams and three reservoirs, 22 weirs and 155 kilometers of channels and tunnels.

ERG said the business was expected to generate annual earnings before interest, tax, depreciation and amortization of about €110 million "over the next few years".

The transaction will be financed via cash and a €700 million loan signed with seven banks, including Barclays , BNP Paribas and Unicredit. It is expected to close at the end of the year.


Short URL : http://goo.gl/jvzZxO

You can also read ...

Russia Oil Minister, Zanganeh Discuss Cooperation in Moscow
Russian energy minister Alexander Novak discussed bilateral...
Oil Trading Listed on Iran Energy Exchange
Iran officially started spot oil trading on its energy...
OPEC: India Oil Demand Rising Rapidly
India’s oil demand is expected to rise by 5.8 million barrels...
Concern Over Loss of Qom Salt Lake
Namak (Salt) Lake in Qom Province is drying up and if it is...
Zanganeh: Sanctions Undermine International Oil Market
Inadequate supplies are posing serious challenges to the...
Iran Petrochem Export Revenue in 6 Months Reaches $6.3b
Petrochemical output reached 27.3 million tons in the first...