De-regulation of Italy's energy sector has promised big US-style acquisition financings. Leading the way is a Eu1.6 billion finance backing acquisition of state incumbent Enel's first spin off, Elettrogen. The consortium, comprising Endesa (45%), BSCH (40%) and Italian regional utility ASM-Brescia (15%), paid Eu2.63 billion for the 5400MW genco in July. Shares have now transferred to an intermediary holding company, Endesa Italia, although debt is being held in the operating company.
DrKW are sole lead arranger on the transaction, which was launched to a one-stage syndication in September. A spokesperson stated that they are quite pleased with the response and expect it to be wrapped up by the end of next week, adding that it is already oversubscribed.
Debt being raised is non-recourse to the project's shareholders, although insiders describe the deal as having a ?corporate flavour'. This refers to the loans' short-term nature and healthy liquidity of Endesa Italia. The latter is an attribute both of Elettrogen's existing revenue stream and a hefty equity injection from sponsors. Gearing stands at 60% and it has been stated that the company has sufficient cash to undertake the pledged...
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