Enea satisfied with the financial parameters of the transaction with ENGIE

ENGIE International Holdings B.V. submitted the calculation of the so-called Initial Selling Price of 100% of shares in ENGIE Energia Polska (EEP), the owner of Połaniec Power Plant. Giving the Initial Selling Price is one of the last elements leading to the transaction closing and share acquisition. Implementing Enea Capital Group’s Development Strategy Enea will soon acquire a fully debt-relieved and modernised power plant having a major share in the production of electricity in Poland.

The Initial Selling Price for 100% of shares in EEP takes into account the full debt reduction of EEP conducted in February 2017 and the estimated level of working capital as at 31 December 2016 and was stipulated on the level of PLN 1,264 million. Based on the data submitted by EEP, and as at 31 December 2016 the Initial Selling Price sets the enterprise value (EV) of ENGIE Energia Polska on the level of PLN 995 million.
– The financial parameters of the transaction are very satisfying for us. Połaniec Power Plant will be valuable assets for Enea. Our Group takes over a modernised company, free from any debts, with considerable positive working capital, in which the existing owner has invested during the recent five years the amount of PLN 1.3 billion – said Mirosław Kowalik, president of Enea.

According to the received EEP’s initial financial data in the Polish accounting standards EEP’s EBITDA in 2016 amounted to PLN 359 million and operating profit to PLN 269 million. The above mentioned financial results include revenue from allocated free CO2  emission allowances in the amount of PLN 73 million, which during next years will be considerably decreased.

– The difference between the enterprise value of ENGIE Energia Polska given on 23 December 2016 and the enterprise value given today as at 31 December 2016 stems from the lower level of EEP’s working capital than anticipated on the agreement execution date – said Mikołaj Franzkowiak, vice-president of Enea for financial affairs. – On the other hand, the difference between the enterprise value and the price of 100% of shares stems from the cash left by ENGIE in EEP – he added.

Pursuant to the market standards adopted by this type of transactions, the Initial Selling Price in the period following directly taking over the control over ENGIE Energia Polska will  be verified by Enea and subject to potential adjustments.

The investment in Połaniec Power Plant is in line with Enea Capital Group’s new Development Strategy. EPP takeover will strengthen Enea’s position as one of the leading electricity generators in Poland and will strengthen the Group’s position on the market. It will also positively affect a growth in Enea Group’s revenue and EBITDA.

The Investment will contribute to the establishment of an energy generation area which is based on its own resource, is cost- and operation-efficient. Kozienice-Bogdanka-Połaniec generation and mining area, located in south-east Poland, will bring numerous synergies profitable for the Group. It will also strengthen the Polish energy security and reliability of energy supplies to Enea’s Customers and will bring positive effects to the regional community.

Połaniec Power Plant is one of the most efficient electricity generators in Poland which has implemented an over PLN 1.3 billion worth of an intensive modernisation programme during recent five years. The modernisations extended the power plant’s operation by over 20 years, increasing the efficiency of energy generation and adjusting the generating equipment to the environmental standards in force, including to the requirements of IED Directive. An important part of the power plant is a modern biomass unit, over 200 MW capacity, which generates “green energy” based on biomass coming from local suppliers.

ENGIE Energia Polska is currently the fifth largest producer of electricity in Poland. Together with ca. 1.9 GW Połaniec power plant the company accounts for 5 per cent of electricity generation in Poland.

Enea Group is one of the leaders of the Polish power market. It manages the complete chain of values: from coal in the mine to a socket at Customer’s home. It is responsible for reliable supplies of energy to 2.5 mln Customers.