Italian electric utility and major renewables player Enel SpA (BIT:ENEL) has struck a couple of agreements to fully exit its subsidiary in Russia for an overall consideration of about EUR 137 million (USD 144m).
Enel has agreed to dispose of its entire 56.43% stake in Enel Russia to local oil giant Lukoil (MCX:LKOH) and private fund Gazprombank-Frezia. The transaction is pending clearance by local authorities and is expected to close within the third quarter of 2022.
In March, Enel’s chief executive Francesco Starace said on Bloomberg TV that he recognises growth in renewables for Russia but because of the country’s armed invasion of Ukraine, Enel sees no other option but to exit the market.
In the official statement announcing the sale, the Italian company says that the move aligns with its strategic aim “to focus its activities mainly in countries where an integrated position along the value chain can drive growth and enhance value creation from the opportunities offered by the energy transition.”
By exiting Enel Russia, the Italian company is parting with about 5.6 GW of conventional capacity and some 300 MW of wind projects in different stages of development. The move will bring a positive effect on its consolidated net debt of about EUR 550 million and have a negative impact on reported group net income of around EUR 1.3 billion.
(EUR 1.0 = USD 1.050)
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