Enel to shed EUR 21bn of assets, reduce investments in 2023-2025
Enel CEO Francesco Starace speaking at Enel's Capital Markets Day 2022. Image source: Enel (handout)
Italian utility giant Enel SpA (BIT:ENEL) will tighten its spending in 2023-2025 and sell assets worth EUR 21 billion (USD 21.6bn) as it works to bring down net debt and focus on six core markets.
The group on Tuesday unveiled its 2023-2025 strategic plan, saying that it will put to work EUR 37 billion of investments to focus its spending on integrated and value-added services, digital grids, sustainable power generation and confine its activities to key countries -- Italy, Spain, the United States, Brazil, Chile and Colombia.
It is less money than defined in the 2022-2024 plan, which was to see Enel invest EUR 45 billion during the planning period.
Enel said that it will “strategically reposition businesses and geographies” to achieve a leaner structure and launch a disposal plan to narrow its debt, which at the end of September reached EUR 69.7 billion.
The utility plans to sell its assets in Romania, leave Peru and Argentina, shed certain assets in Brazil to focus more on distribution grids in Rio and Sao Paulo, and initiate the exit from gas-fired power plants.
Most of the disposal activity is expected to be rolled out by the end of 2023, Enel said.
As for the investments, around 50% of the EUR-37-billion plan will support power generation, some 10% will go towards retail and advanced energy services, while grids will account for the remaining 40%.
Enel expects to add around 21 GW of new renewables capacity by 2025, with the core countries hosting some 19 GW of the planned total. The plan is to manage around 75 GW of renewables, including 4 GW of battery storage, by the end of 2025.
Enel’s financial targets for 2023-2025 are presented in the table:
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