Eni's biofuel unit could be valued up to 12.5 bln euros in KKR deal
Adds analyst comment in paragraph 3, context on Eni's strategy in paragraphs 4-5, background on Enilive business
By Francesca Landini
MILAN, July 23 (Reuters) -Italian energy group Eni ENI.MI said on Tuesday it is in exclusive talks with investment firm KKR KKR.N over the potential sale of a minority stake in Enilive, in a deal that could value the biofuel unit at up to 12.5 billion euros ($13.6 billion).
The deal - under which KKR could buy between 20% and 25% of Enilive - is part of Eni's strategyto develop separate units focused on specific businesses and make them become financially independent.
"The valuation in the range of 11.5-12.5 billion euros is well above market expectations, which we think were in the range of 7-10 billion euros," said Biraj Borkhataria, head of Global Energy Transition Research at Royal Bank of Canada.
In another step of the broader plan, Eni agreed in December to sell to Swiss fund Energy Infrastructure Partners (EIP) a minority stake in its retail and renewable unit Plenitude in a transaction that valued the company at around 10 billion euros.
The long-term goal of Eni is to attract investors to shareinvestments in its energy transition businesses and also boost the valuation of the entire group.
"The strong interest shown in this period by leading institutional financial investors could lead to the subsequent sale of a further stake of up to 10% of Enilive," Eni saidin a statement.
Mediobanca is acting as financial advisor for Eni on the Enilive stake sale.
The unit is focused on biorefining, biomethane production, smart mobility solutions and has a network of more than 5,000 multi-fuel stations in Europe.
Enilive plans to increase its biorefining capacity to more than 3 million tonsby 2026, doubling the capacity it had at the end of2023.
($1 = 0.9186 euros)
Reporting by Francesca Landini, editing by Giulia Segreti and Susan Fenton
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
