(Bloomberg) -- Enel SpA is back on the acquisition trail after two years focusing on reducing debt.
Italy’s top utility agreed to buy Acciona Energia’s hydro-power portfolio in Spain via its local subsidiary Endesa for €1 billion ($1.05 billion), according to a statement late on Friday.
The deal marks a shift in strategy under Chief Executive Officer Flavio Cattaneo after the company completed a divestiture plan aimed at paring a debt pile that had ballooned to record levels.
Cattaneo, appointed last year by the Italian government, inherited a €21 billion asset sales plan from predecessor Francesco Starace. Since reaching more than €70 billion a few year ago, net debt has dropped to €56 billion in September, taking into account signed deals, Chief Financial Officer Stefano De Angelis said in an earnings call.
Enel’s net debt is expected to fall to 2.4 times earnings before interest, taxes, depreciation and amortization by the year-end, “well below the sector average,” De Angelis added.
The acquisition will give Endesa a portfolio of 34 hydro power plants located in northeastern Spain with a total installed capacity of 626 megawatts.
Enel is set to unveil its 2025-2027 business plan on Monday. The state is the company’s biggest shareholder with a stake of about 24%.
©2024 Bloomberg L.P.