Italy's Enel has signed a binding agreement for the acquisition of fibre cable provider Metroweb Italia, through its subsidiary Enel OpEn Fiber for €714 million.
The agreement, which sees Enel winning the competition against Telecom Italia, envisages that Enel and CDP Equity (a state-controlled company that invests in companies of 'major national interest') will provide EOF with the necessary capital to acquire the totality of Metroweb from F2i SGR and FSI Investimenti. Metroweb is to be incorporated in EOF, with Enel and CDPE acquiring an equal share in the company.
The deals also states F2i will retain the option to reinvest in the NewCo through the acquisition of up to 30% shares from Enel and CDPE. The deal will allow Enel to progress the development of fibre cabling in Italy, it said. The closing of the acquisition is expected for December 2016, pending regulatory approval.
'Low risk' grid helps Enel balance power gen business
Enel also announced it aims to widen the perimeter of the cabling, developing an offer that includes “the major Italian cities” being therefore “of interest for all alternative operators which appreciate a nation-wide project.” According to what reported by Bloomberg earlier in March, Enel will use existing assets, such as transmission towers and electricity cabinets to host fibre-optic cables.
The diversification of Enel's assets away from traditional power generation ones is in line with the company's strategy for the period 2015-2019, which targets gross Capex of €34 billion over 2016-2019, with some €6 billion of growth Capex, 90% of which “devoted to driving revenue growth in low risk businesses, such as networks, renewables, non-merchant conventional generation and retail” amid falling electricity demand and prices, particularly in Europe.
As part of the reorganisation, Enel also continues its plans to mothball conventional generation capacity. Some 3.3 GW of installed thermal generation capacity were mothballed in the first half of 2016, it showed in its H1 2016 financial results.