Italy’s Enel to sell assets and focus on six main markets

MILAN, Nov 22 (Reuters) – Enel plans asset sales worth 21 billion euros ($21.5 billion) to reduce net debt and focus its transition to cleaner energy on six core countries, the Italian utility said on Tuesday.

The bulk of the disposal plan should be achieved by the end of 2023 and will include an exit from Argentina and Peru and the sale of assets in Romania, the group said in its 2023-25 strategy update.

The state-controlled group intends to invest around 37 billion euros in the next three years in its six core markets of Italy, Spain, the United States, Brazil, Chile and Colombia.

It also confirmed its plans to become carbon-free by 2040 as it shifts away from fossil fuels towards greater use of renewables.

Enel, which could also sell its gas portfolio in Spain, aims to lower its net debt to 51-52 billion euro by the end of 2023 from 69 billion at the end of September.

CEO Francesco Starace told analysts that turbulence in energy markets meant Enel needs to return to more normal financial ratios.

However, he said current high prices should help it to crystallise the value of its gas assets.

Russia’s invasion of Ukraine has underlined the importance of energy independence, Starace added.

He cited the expansion of a solar panel plant in Sicily as an example of this and added that a similar project was being evaluated in the United States.

Enel pledged to reward investors with a 0.43 euro dividend per year for the 2023-2025 period, up from 0.40 euros in 2022.

Shares in Enel were up 1.7% as of 0850 GMT.

Ordinary EBITDA is expected to grow to between 22.2 billion and 22.8 billion euros in 2025 from 19.0 billion-19.6 billion euros estimated for 2022, the group said. ($1 = 0.9761 euros)

Reporting by Francesca Landini; writing by Keith Weir; editing by Kirsten Donovan and Jason Neely

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