EDP to sell assets in Spain for €515 million
Portugal’s energy giant EDP is to sell to sell two power station groups in Castejón, Navarra in Spain for €515 million.
The combined cycle plants which produce 843 MW of power is to be bought by Total in a deal which should be completed in the second half of 2020.
The operation which also involves the sale of a 50% share in CHC Energia, a joint-venture with CIDE for the retail sale of energy, will being in €515 million to the Portuguese energy giant.
The transaction should be completed in the second half of this year after getting the green light from regulators.
The deal is part of the EDP Group’s Strategic Plan 2019-2022. The plan, presented in March last year, foresees a reduction in thermal generation assets and exposure to price volatility in the wholesale market.
This operation reinforces EDP’s low risk profile, helping to reinforce the weight of long-term contracted and regulated activities in EBITDA and accelerating financial leveraging, thus allowing for an improvement in results. Just one year after the presentation of the Strategic Plan, EDP has already fulfilled 65% of the total asset sales and rotation target with a positive impact on the company’s net debt.
For EDP’s CEO, António Mexia, “this is an excellent operation for EDP which, once again, enhances the quality of our assets, but also our solid execution capacity, as we continue to create significant value with the portfolio optimiSation strategy defined in our business plan. After this agreement, EDP will maintain more than 95% of EBITDA in Spain, which is one of our strategic markets and where we will continue to invest in the generation, networks and supply of renewables, both in the B2B segment and in the new downstream segment”. In addition, he reinforces, “this transaction is fully aligned with our commitment to lead the energy transition, providing EDP with additional flexibility as we build a more sustainable future – a future that will be electric”.
Spain will thus continue to be a strategic market for EDP, with an active contribution to the company’s goal of leading the energy transition. In this sense, EDP will continue to invest in new renewable energy plants and in the transformation of existing production centres, such as the Aboño Plant (Asturias), where group 1 will be adapted to burn steel gas and become a source of electricity generation.
EDP’s bet on the Spanish market also includes improvements in the electric networks and offering a wide range of services to companies, a segment in which it maintains a significant commercial portfolio. In addition, the company maintains a strong commitment to the distributed generation and electric mobility market for all customer segments.
EDP’s activity in Spain is a reference in the energy market, both in production (with more than 4,600 MW of installed capacity) and distribution (668.500 supply points), as well as in the sale of electricity, natural gas and services, where maintains a portfolio of 14 TWh (not including B2C). In total, the company will continue to employ more than 1,550 people.