One could say NonSoloSnam. In the strategic plan to 2026 announced by the utility, controlled by Cdp and participated by the Modenese entrepreneur Romano Minozzi, there is not only talk of business, but also of putting order in thearchipelago indistinct of the Snam investees.
The affiliates seen as a possible source of value
The communiqué already devotes a separate chapter to the affiliate portfolio, defined as an “element of value creation”. Also, when the company refers to the capital allocation strategy, adds that “the implementation of the investment plan remains a priority together with the maximization of the value of the assets, i.e. of the affiliates” and specifies: “Snam could evaluate a strategy of capital turnover for assets considered "non-strategic" to be used for possible business opportunities non-organic growth.
Ad Venier attentive to M&A opportunities
The CEO of Snam then entered in more detail Stefano Venier answering analyst questions during the presentation of the new strategic plan 2022-2026, which provides for total investments of 10 billion euros (up 23% compared to the 2021-2025 plan):
Snam may consider M&A “if non-organic opportunities arise in the gas infrastructure business with a clear focus on the national market” said Venier. “We have only small acquisitions currently underway in the biomethane business area, which are part of the pipeline launched in 2022 and which will be carried out in 2023, but they are really marginal compared to the numbers we have presented”, the CEO pointed out.
The current situation of the Snam archipelago and what future strategies could be
In the monopoly of society, on the one hand there are some new entry strategic, on the other there are holdings considered less fit with respect to the utility business and which could be left, while to this is added the interest in other assets which could be absorbed.
Snam the investments nop and yep
Snam which, has revised the guidance on net income at the end of 2026 to 1,27 billion euros from 1,13 in 2022, recently added in its portfolio the participation in Southern corridor with Algeria, comprised of TTPC and TMPC, which have been grouped into clusters to reflect their role in the short and medium-long term strategic objectives.
The defined assets belong to the first group “Value Enhancers” of the national infrastructure, i.e. those with a connection to the Snam network in Italy and which contribute to around 60% of the net income from investees expected by 2026. Instead, they are defined “Enablers” of optionality of the French business Terega, the British Interconnectors and the emirate Adnoc: they don't have a connection to the Italian Snam network but they offer market visibility, as well as business opportunities and possibilities with respect to portfolio evolutions.
De Nora is a success story
Within the chapter on investments in energy transition businesses (which amount to 1 billion euros), joint projects with De Nora. Snam has a 25,79% stake in the company listed on Euronext Milan and specialized in electrochemistry and the green hydrogen supply chain. “Our partnership with De Nora is based on further developments, with the construction of a Gigafactory for the production of electrolysers in Italy, for which the EU Commission, within the framework of the IPCEI Hy2Tech programme, has authorized the granting of financial support up to a ceiling of 63 million euro”, reads the floor. Venier then spoke of De Nora as "a success story“. “The implied value is, in our opinion, higher than the current share – added Venier – We are ready to support it, but we don't need to have a 25% stake and we will see in the future how the shares will move and what opportunities there will be".
Snam participates: a spin-off possible for Italgas
In addition, there are participations such as Italgas, of which Snam is the second largest shareholder, behind CDP, with a 13,5% stake, and ITM Power, “that they can fit into a more opportunistic logic”, underlines Snam in presenting the plan. In particular about Italgas Venier said : “a spin off, it is listed and operates in a sector in which we can have neither a direct connection nor synergies for a whole series of reasons, it is a good company that makes a good contribution to our group, however we can consider it to optimize our financing“, concluded Venier.
Snam investees and M&A: Edison storage is under observation
To a question about the possibility that Snam is interested in the storage capacity of Edison, Venier replied: “The answer is obvious. Edison's storage capacity is 1 bcm, ours is 11 bcm. He would makes sense to put these two assets together to have synergies, but a lot it depends from the decisions that Edf and Edison will have in this regard. We will definitely follow up this option very closely", has explained.
The center of gravity of the European energy system moves south
More generally, Snam has outlined what the sectors will be greater interest, on which it concentrates its M&A activities. The high uncertainty and diversification from Russian sources have meant that the center of gravity of the European energy system is moved from north to south, then towards the Mediterranean, “from which they will arrive in a structural way higher flows, with important role for our country”, predicted Venier. In this context, Snam "has a unique position on the European TSO market, it is the most integrated across the entire value chain, from transport to storage, and has assets in crucial positions for hydrogen".
The role of the Austrian Tag
The manager underlined the need to “relaunch Italy's role in the energy context European“. An assist comes from the so-called “counterflow, an aspect that was less important in the past”. “In the future this will present an opportunity that we will seize more and more – he explained – We consider this flow towards the North as something that will increase”. The northward flow can be up to 10 billion cubic meters per year. 4,2 billion cubic meters of gas have been exported this year and 6 bcm have already been booked for next year through the Tap. Considering that the Austrian market represents only 8 bcm, the Austrian Tag will have a new role“.
