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UPDATE 1-Italy restarts the clock on Enel stake sale - sources
February 5, 2015 / 4:43 PM / 3 years ago

UPDATE 1-Italy restarts the clock on Enel stake sale - sources

(Adds comment from sources, 2014 results, details)

By Francesca Landini and Stephen Jewkes

MILAN, Feb 5 (Reuters) - Italy is preparing for another attempt at selling a stake in utility Enel worth just shy of 2 billion euros ($2.3 billion) for stretched state coffers, two sources close to the matter said.

The government has said it would sell a stake in the power group by the end of the year and two sources on Thursday said the Treasury has asked its advisers to monitor the market in preparation.

The government, which controls around 30 percent of Europe’s No. 2 utility for installed capacity, had initially planned to sell around 6 percent of the group by the end of last year but delayed the sale because markets were choppy.

“The advisers have restarted monitoring the market since early January, but as yet have not received any indications from the Treasury as to the timing of the sale,” one of the sources said on Thursday.

Italian daily Il Sole 24 Ore said in an unsourced report the Treasury had agreed with advisers Equita and Clifford Chance at a meeting on Monday to speed up the sale.

The paper said the placement would take place through an accelerated bookbuilding procedure in the two weeks starting from next Monday with Feb. 16-20 the most likely dates.

“I don’t think the February guideline is quite accurate,” a top political source told Reuters.

A banker familiar with the company said the sale could be done quickly should the market be favourable, while a second banker said many investors were waiting for Enel’s CEO Francesco Starace to present his first business plan in March before taking positions.

Like other big traditional European utilities, Enel has been battered by the prolonged economic crisis that has undermined power demand and margins and has suffered from fierce competition from renewable energy operators.

Enel, one of Europe’s most indebted utilities, said on Thursday it had cut its 2014 debt more than expected thanks in part to the recent sale of a 22 percent in Spanish unit Endesa .

But the debt reduction news, welcomed by brokers, failed to reverse the share losses triggered by the reports Rome was close to selling down its stake.

At 1400 GMT shares in Enel were down 3.3 percent at 3.90 euros, while the European utility index was 1 percent lower.

$1 = 0.8751 euros Additional reporting by Giselda Vagnoni in Rome; Editing by Elaine Hardcastle

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