Enel to shed Romanian business to Greece's PPC for EUR 1.26bn

Italian energy major Enel SpA (BIT:ENEL) has clinched a deal to offload its Romanian assets to Greek power utility PPC SA (ATH:PPC) for EUR 1.26 billion (USD 1.33bn) amid a wider plan to reposition itself on high-growth markets.

The transaction, which is seen to be completed by the third quarter, gives the Romanian business an enterprise valuation of EUR 1.9 billion.

The deal’s signing was announced after the parties sealed an exclusivity agreement in December 2022 and later extended its term to give PPC more time to conduct due diligence.

Enel, which has been operating in Romania since 2005, serves over 3 million customers through its local supply and distribution network. The group is also active in the energy efficiency and e-mobility sectors, while its local green energy arm Enel Green Power Romania owns 12 wind and solar parks of 534 MW in total.

The Italian group noted that the total consideration of the deal is subject to adjustments and an earn-out mechanism for a potential additional payment based on the future value of the retail business. It expects the sale to help it cut its consolidated net debt by around EUR 1.7 billion.

Enel’s divestment is part of the group’s plan to tighten spending in 2023-2025 by shedding assets worth EUR 21 billion (USD 22.3bn) as it works to bring down net debt and focus on six core markets – Italy, Spain, the US, Brazil, Chile and Colombia. The strategy, presented in November 2022, also envisages the sale of assets in Peru, Argentina and Brazil.

(EUR 1.0 = USD 1.059)

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