Eni Strikes Deal for Energy Infrastructure Partners to Invest in Plenitude -- Update

By Andrea Figueras

Eni agreed to sell a minority stake in its low-carbon unit Plenitude to investor Energy Infrastructure Partners, in a deal valuing the business at roughly 8 billion euros ($8.75 billion) that could pave the way for a potential initial public offering.

The Italian oil-and-gas major said Thursday that Energy Infrastructure Partners would acquire a stake of up to 9% in Plenitude through a capital increase of up to EUR700 million by early 2024, becoming a minority shareholder.

The transaction, which gives Plenitude an equity value post money of up to around EUR8 billion and an enterprise value of more than EUR10 billion, will reinforce the subsidiary's balance sheet, reducing corporate debt and supporting the company's strategic plan, Eni said.

Plenitude's valuation is consistent with market expectations and provides an important valuation floor in the context of a potential IPO later in 2024, Jefferies analyst Giacomo Romeo wrote in a note to clients.

The agreement will support the company's growth in the production of energy from renewable sources, in the market for the sale of energy and energy-efficiency solutions for retail and business customers, and in the deployment of charging infrastructure for electric mobility in Italy and Europe, Plenitude said.

Plenitude has ambitious growth targets across its business lines for the coming years, Energy Infrastructure Partners said.

The company aims to deliver more than 7 gigawatts of installed renewable capacity by 2026 and 15 gigawatts by 2030, up from 2.2 gigawatts at the end of 2022, Eni said, while Plenitude's earnings before interest, taxes, depreciation and amortization are expected to triple over the 2022-2026 period, reaching EUR1.8 billion.

The deal is also set to improve Eni's capital structure, reducing its consolidated net financial leverage and optimizing its capital base, said Eni's Chief Executive Claudio Descalzi.

In June 2022, Eni intended to launch an IPO for Plenitude for the listing of ordinary shares on Euronext Milan. However, the company postponed the stock market debut citing deteriorated market conditions.

Write to Andrea Figueras at [e-mail]

(END) Dow Jones Newswires

December 21, 2023 06:44 ET (11:44 GMT)

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