Press Release

Enel Group signs agreement to sell energy distributor in Goiás

Bnamericas Published: Friday, September 23, 2022

This is a machine translation of the Enel press release originally published in Portuguese. 

Enel SpA (Enel) informs that its subsidiary Enel Brasil SA, controlled through the Chilean company Enel Américas SA, signed today with Equatorial Participações e Investimentos SA (Equatorial), a subsidiary of Equatorial Energia SA, a Purchase and Sale Agreement to sell its entire interest in the Brazilian energy distribution company CELG Distribuição SA – CELG D (Enel Goiás), equivalent to approximately 99.9% of the latter's share capital. The sale is subject to the approval of the Boards of Directors of Enel Brasil and Enel Américas, which are expected to meet in extraordinary sessions on September 28, 2022, in addition to being subject to certain additional conditions precedent customary for these types of transactions, including authorization from the National Electric Energy Agency (ANEEL) and the country's antitrust authority, the Administrative Council for Economic Defense (CADE).

The Agreement provides that, for the totality of Enel Brasil's interest in Enel Goiás, Enel Brasil will receive a total amount of approximately 7.3 billion reais (equivalent to approximately 1.4 billion dollars), subject to adjustments until the closure. Of the total amount:

• Equatorial will pay, for the shares of Enel Goiás, approximately 1.6 billion reais (equivalent to more than 300 million dollars) at closing, which is expected by the end of the year, and;

• Enel Goiás will settle loans with Group companies for the amount of approximately 5.7 billion reais (equivalent to approximately 1.1 billion dollars) within 12 months after closing.

The Agreement covers (i) current cash position, (ii) third-party debt and (iii) contingencies of Enel Goiás.

Additionally, the parties agreed to an earn-out payment mechanism based on the outcome of the contingencies.

The total transaction is expected to have a positive effect on the Group's consolidated net debt of around €1.4 billion.

The transaction is in line with the Enel Group's current Strategic Plan, as it contributes to the objective of constantly improving and optimizing the risk-return profile of the Group and its asset base, with a focus on priority businesses. The sale of Enel Goiás is in line with the Enel Group's current strategy for Brazil, to focus the electricity distribution business in networks located in urban areas and fully take advantage of the opportunities arising from the Group's integrated presence in the context of the energy transition, with the advancement of distributed generation and smart grids in the coming years.

Enel Goiás is a Brazilian electricity distributor located in the State of Goiás, with a concession area of 337 thousand km2 and 3.3 million customers in 237 municipalities.

Equatorial is the third largest distribution group in Brazil in terms of number of customers. The company operates six concessionaires in the states of Maranhão, Pará, Piauí, Alagoas, Rio Grande do Sul and Amapá, serving approximately 10 million customers in these regions. The company also operates in the transmission sector and has recently entered the sanitation sector and the renewable generation sector.

Enel, which celebrates its 60th anniversary this year, is a multinational energy company and a leading integrated player in the global energy and renewables markets. Globally, it is the largest private player in renewable energy, the leading grid operator by number of end users and the largest retail operator by customer base. The Group is the world leader in demand response and the largest European concessionaire in ordinary EBITDA [1]. Enel is present in 30 countries around the world, producing energy with more than 92 GW of total capacity. Enel Grids, the Group's global business line dedicated to managing the electricity distribution service globally, supplies energy through a network of more than 2.3 million kilometers to more than 75 million end users. The Group takes energy to around 70 million homes and businesses. Enel's renewable energy arm, Enel Green Power, has a total capacity of over 55 GW and a generation mix that includes wind, solar, geothermal and hydropower, as well as energy storage facilities in Europe, the Americas, Africa , Asia and Oceania. Enel X Global Retail, Enel's global business line active in the areas of supply and energy efficiency, has a total capacity of around 7.9 GW of globally managed demand response and 62 MW of installed storage capacity for customers. In addition, Enel X Way is the Group's new company fully dedicated to electric mobility, managing more than 380,000 public and private EV charging points worldwide, directly and through interoperability agreements.

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