TEXT-S&P release on Endesa S.A.

(The following statement was released by the rating agency)

April 11 - Standard & Poor's Ratings Services said today that it has affirmed its 'A-' long-term and 'A-2' short-term corporate credit ratings on Spanish utility Endesa S.A. (ELE.MC: Quote, Profile, Research).

At the same time, the long-term rating was removed from CreditWatch, where it had initially been placed with negative implications on Sept. 6, 2005. The outlook is negative.

"The affirmation reflects our expectation that Endesa's credit protection measures and business risk profile will remain consistent with the ratings, including funds from operations to debt of above 20%," said Standard & Poor's credit analyst Ana Nogales. While the ratings reflect Endesa's stand-alone creditworthiness, we cannot look at them in complete isolation from the credit quality of Enel SpA (A-/Negative/A-2) and Acciona, which acquired respectively 67% and 25% of Endesa in October 2007.

These owners will steer Endesa's growth and investment strategy, as well as its still somewhat uncertain financial and dividend policies. "Measures taken by the shareholders, depending on their scope and degree of risk, could affect the ratings on Endesa," said Ms. Nogales.

The ratings factor in the anticipated deterioration of Endesa's business profile following the forthcoming asset sale to E.ON AG (A/Stable/A-1) for an agreed total enterprise value of EUR11.5 billion.

These disposals will increase the group's exposure to the higher risk Latin American operations. The ratings remain underpinned by Endesa's solid position as Spain's largest vertically integrated electricity utility and its well-matched generation and supply businesses.

These strengths are partially offset by increasing competition in the Spanish market. Spanish and Portuguese operations will remain the primary EBITDA contributors in the future.

Cash flow protection metrics should remain adequate for the ratings, with funds from operations to total debt exceeding 20%. Ultimately, future debt levels will depend on the evolution of operating cash flow and, even more so, on the business strategy and financial policy implemented by the shareholders.