ERG, through its subsidiary ERG Power Generation S.p.A., has agreed to sell it's hydropower portfolio operated by ERG Hydro S.r.l to Enel Produzione S.p.A for €1.0 billion.
The portfolio consists of an integrated hydroelectric power generation system that spans Umbria, Lazio, and Marche. It comprises 19 hydroelectric plants, seven mini-hydro plants, seven dams, four reservoirs (alto, Turano, Corbara, and Piediluco), and a pumping station, with a combined capacity of 527MW. Average annual production is around 1.5 TWh, of which 35-40% is subsidised until 2025.
The sale agreement includes significant employment protection to the current workers at the projects.
The sale is expected to close in 2022, subject to certain conditions. Rothschild & Co. and Mediobanca jointly acted as financial advisors in the transaction. DLA Piper acted as legal advisor, Ernst & Young as accounting and tax advisor, Arup as technical advisor, and Ref-e as market advisor.
