* EDF unit Edison wants to triple its Italian retail base
* Says liberalisation is opportunity to win market share
* Hopes to buy oil major Eni's retail clients base
* Wants to become number one wind operator in Italy
(Adds CEO's comments about opportunities in Italian market)
By Geert De Clercq
PARIS, Nov 28 Italian energy group Edison
, a division of French utility EDF, wants to
triple the size of its domestic electricity and gas retail
business as the market is opened up to more competition, and is
interested in buying oil company Eni's retail business,
its CEO said on Monday.
Eni wants to sell its portfolio of some 8 million Italian
gas and power retail supply accounts as part of a plan to repay
debt and fund major oil and gas projects. This $3.4 billion sale
has been delayed due to political uncertainty linked to Italy's
Dec. 4 referendum on democratic reform.
"Eni has expressed a desire to step out of retail. We are
ready to respond to this and will be active if a sale is
initiated," Edison's chief executive Marc Benayoun told
Benayoun estimated that Eni's client base was worth "a few
billion euros" but said no talks had yet started with Eni, which
would only decide how much of the business it wanted to sell by
the end of March.
Benayoun said that if a deal with Eni materialised, EDF -
which owns 99.48 percent of Edison - would be ready to sell a
20-35 percent stake in Edison to a long-term Italian investor in
order to help finance the operation.
He said EDF could also sell some of its own shares in Edison
on the stock market but would keep a majority stake.
With a 7 percent market share, Edison is the third biggest
power producer in Italy after market leader Enel,
which has a 26 percent share, and Eni. It is also the third
biggest gas wholesaler with a 6 percent share, compared with
market leader Eni's 83.3 percent.
But in energy retailing in Italy Edison remains small, with
just 1.2 million customers, making it the sixth biggest retail
supplier behind Enel, the biggest with nearly 32 million
customers, Eni and three regional Italian utilities.
Benayoun said Edison wanted to increase its customer base to
"With just 1.2 million customers one can barely survive. We
need at least 3 million to win economies of scale," he said.
Edison will try to win more business with new marketing
promotions, such as offering to pay new customers' television
viewing tax, which is integrated in utility bills in Italy, and
by making acquisitions.
Benayoun said that from 2018, when Italian retail energy
customers will be able to chose their supplier, lots of smaller
retailers who now sell energy under regulated tariffs may want
to sell and Edison would be ready to buy.
A deal with Eni - which has 7.9 million customers, 5.9
million of which take gas and 2 million electricity - could
move Edison up the rankings. But it would not necessarily buy
the entire portfolio as the gas retailing business would be more
easily integrated than the electricity portfolio.
Benayoun also said Edison wanted to boost the share of
renewables in its generation portfolio to about 40 percent from
the current 20-25 percent.
Edison has launched a 107 million euro ($120 million) bid
for Italian wind farm operator Alerion which closes
Alerion has an installed capacity of 260 megawatts (MW)
which, combined with Edison unit E2i's 590 MW, would make Edison
Italy's second-biggest wind power generator behind ERG.
Italy's 9,000 MW of wind power is fragmented, with only ERG
operating more than 1,000 MW of capacity.
Benayoun said Edison was also considering another
acquisition and hopes to win tenders for 80 to 100 MW of new
capacity. This, combined with the E2i and Alerion capacities and
the 260 MW that EDF unit EDF Energies Nouvelles operates in
Italy would give Edison a total capacity of more than 1,000 MW.
"With Alerion, the tenders, the consolidation of EDF EN and
the potential of another takeover, we could become the number
one wind player in Italy by the end of 2017," Benayoun said.
Benayoun also said Edison could return to profitability in
2018. He expects the company to come close to break-even in 2017
and to book a small net loss this year.
Benayoun - who is also head of EDF's gas business -
estimates EDF's oil and gas exploration assets are worth about 1
to 1.5 billion euros.
He said that after expanding in several countries, EDF would
now focus its investments on Italy and Egypt and plans to sell
its British and Norwegian oil and gas interests.
(Editing by Ruth Pitchford, Greg Mahlich)