Commercial partnership between Hera, the Bolognese multiutility chaired by Tomaso Tommasi di Vignano and the Venetian Ascopiave. The Boards of Directors of Hera Spa and Ascopiave Spa have approved the signing of a Term Sheet binding for the development of a primary reality within the territories of the North-East, which will be able to count on over one million energy customers, as well as a contextual reorganization of the respective gas distribution activities.
Il Term Sheet, which will be finalized in a framework agreement by the deadline of 31 July 2019, defines the perimeters involved, the economic terms of the agreement, as well as the related governance elements. The agreement reached constitutes an important strategic step in the evolution of the business portfolios of the two groups, in full coherence with the strategic development lines approved by the Boards of Directors of Hera Spa and Ascopiave Spa and communicated to the investors.
In particular, the agreement in the gas and electricity customer marketing area provides for the creation of a single operator for the respective commercial activities in the regions of Veneto, Friuli-Venezia Giulia and Lombardy, through EstEnergy Spa, already today a company jointly controlled by Ascopiave Spa and Hera Comm Srl, a commercial vehicle of the Hera Group. EstEnergy Spa, will see a substantial expansion of activities in the indicated area, going to include the commercial business of the Ascopiave Group relating to the subsidiaries Ascotrade Spa, Ascopiave Energie Spa, Blue Meta Spa and the joint ventures Asm Set Srl (49%), Etra Energia Srl (51%) and Sinergie Italiane Srl in liquidation (30,94%) as well as the company Energia Base Trieste Srl (92.000 contracts managed) and the Veneto and Friuli customers of Hera Comm (96.000 gas contracts and 68.000 electricity contracts), thus giving rise to a primary operator rooted in the North-Eastern territory with a portfolio of over 795.000 gas contracts and 265.000 total electricity contracts as at 31.12.2018 also considering the pro-rata components of the joint ventures, therefore for a total of over 1 million contracts .
The new reality, which will be created through EstEnergy, when fully operational, will have a consolidated Ebitda of approximately €69m - on a 2018 basis excluding the contribution of companies held with minority interests. 52% of the share capital of EstEnergy will be held by the Hera Group and 48% by Ascopiave. The parties agreed that theequity value of the new EstEnergy is equal to a total of €864,5m (€797m perenterprise values correspondent), with reference to 31.12.2018 and is subject to any subsequent adjustments to practice with respect to the date of closing; this value for €601m (€543m perenterprise values) is attributable to commercial activities originating from Ascopiave and €263m is attributable to activities originating from Hera Comm.
In order to regulate future governance, a Shareholders' Agreement will be signed which will provide for a Board of Directors of the new EstEnergy made up of 5 members - 3 appointed by Hera, who will be responsible for the appointment of the Chief Executive Officer, and 2 by Ascopiave, who will be responsible for appointment of the Chairman, as well as of the Chairman of the Board of Statutory Auditors-, the usual protection clauses in favor of a minority shareholder, as well as a right of transfer, exercisable annually, in favor of Ascopiave up to the entire shareholding for a period of 7 years held in EstEnergy Spa and a purchase right in favor of Hera Comm in the event of residual participation by Ascopiave Spa in EstEnergy Spa lower than or equal to 5% of the company's capital. In particular, the put option on the minority stake in EstEnergy may be exercised, in whole or in part, up to the seventh year from closingand at an exercise price equal to the higher of (i) the fair market value of the investment calculated at the exercise date and (ii) the value of the investment revalued by an annual interest of 4% net of the share of dividends received and in any case not less than the value of the investment itself.
Furthermore, as part of the overall reorganization in the gas and electricity customer marketing area, Amgas Blu will also be involved, a commercial company wholly owned by Ascopiave, active in the province of Foggia with around 50.000 customers, which will be acquired directly by Hera Comm at a price equal to approximately 44 m€, including the financial position, and always referring to 31.12.2018.
At the date of closing Ascopiave will acquire a stake of around 3,6% in Hera Comm at the price of €65m, obtaining the right to appoint a director within the company's Board of Directors. Also for this share a mechanism is envisaged in favor of Ascopiave for the sale of the investment held in Hera Comm, to be exercised in the same 7-year period.
The reorganization of the gas distribution activities envisages, on the other hand, the purchase by Ascopiave from the Hera Group of a perimeter of concessions including 188.000 redelivery points distributed in Veneto and Friuli-Venezia Giulia at an investment value of 171 m€ and a pro forma EBITDA of €15,9m, both referring to 31.12.2018. Through this operation, the Ascopiave Group will manage approximately 775.000 users and over 12.000 km of network, thus becoming the first operator in the Triveneto area in terms of size and consolidating its position in the national ranking.
With this operation, Ascopiave implements the strategic repositioning plan, signing an agreement on the commercial areas with a primary player and strengthening its presence in the core business of gas distribution.
The Hera Group, for its part, through the agreements with Ascopiave anticipates the achievement of the target of 3 million customers in commercial activities energy (3,2 million referred to 31.12.2018) set in the business plan to 2022 and follows the growth path in these activities which in the last 10 years has allowed the Group to double its customer base energy, in a path made of organic growth and M&A.
The transaction, in addition to the definition of the final agreements by the deadline of 31 July 2019, will be subject to the usual conditions envisaged for this type of transaction and to all communications and approvals from the competent authorities and bodies, as well as, as regards only stakes concerned, to the approval of the other shareholders in the case of stakes held by Ascopiave Spa in the j ASM Set Srl, Etra Energia Srl and Sinergie Italiane Srl in liquidation. The parties expect to complete the transaction by the deadline of 31.12.2019.
In the operation, Ascopiave is assisted by the Rothschild&Co. team, for the financial part, and by the Bonelli Erede studio, for the legal part, while Hera makes use of Lazard and the Grimaldi studio.
