Sun. Feb 23rd, 2020

Iberdrola sells its stake in Scottish Power Generation for 801 million euros to Drax Group

Iberdrola sells its stake in Scottish Power Generation for 801 million euros to Drax Group


MadridUpdated:

Iberdrola has reached an agreement with the British Drax Group for the sale of all of its participation in Scottish Power Generation for an amount of 801 million euros (702 million pounds sterling), as reported by the company to the National Securities Market Commission (CNMV).

Specifically, the power company chaired by Ignacio Sánchez Galán has been released from a total installed capacity of conventional electric power generation 2,566 megawatts (MW) in the United Kingdom. The operation is framed within the asset rotation plan worth 3,000 million euros announced by the energy group within its strategic plan 2018-2022.

Iberdrola has estimated that the sale will have «A positive impact» in its consolidated results for this year, which "quantify and communicate at the close of the transaction".

The execution of the operation is subject to approval by the general meeting of shareholders of Drax Group, in relation to which the board of directors of the company will issue a circular ("Class 1 circular") to its shareholders recommending the same, and to the approval of the competition authorities of the United Kingdom

New strategic plan

Last September, Drax Group already confirmed that it was negotiating with the Spanish energy company the purchase of these traditional generation assets in the United Kingdom. ANDn February, Iberdrola launched its strategic plan for 2018-2022, period in which it plans to invest 32,000 million euros and place its profit at the end of the period between 3,500 and 3,700 million euros.

This "road map" of the energy company also includes the implementation of this plan of turnover of assets for 3,000 million euros and is open to possible agreements with partners for renewable projects ("partnering green"). Together with this sale in the United Kingdom of assets of its subsidiary Scottish Power, Iberdrola is also studying the sale of its cogeneration plants in Spain.

Specifically, the power company chaired by Ignacio Sánchez Galán has a total of 19 cogeneration plants in Spain, with a power of 368 MW. This asset rotation is part of the path towards the decarbonization of the company and the change of polluting plants in its portfolio due to a clear commitment to renewables.

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