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UPDATE 1-EDF's Edison, Italy's F2i agree to form renewable energy firm-source
July 29, 2014 / 7:37 PM / 3 years ago

UPDATE 1-EDF's Edison, Italy's F2i agree to form renewable energy firm-source

(Adds second source with possible deal value, context)

MILAN, July 29 (Reuters) - Italy’s No. 2 utility Edison , a unit of France’s EDF, and Italian infrastructure fund F2i have signed a deal to form a new renewable energy group, a source close to the situation said on Tuesday.

F2i will own 70 percent of the new company and the remainder will belong to Edison, the source added. The two companies will put renewable energy assets for a total 600 megawatts into the new company.

An Edison spokeswoman said it was too early to disclose details of the transaction, but that in any case Edison would “maintain industrial control of the new company”. An official announcement on the agreement is expected on Wednesday or Thursday, the source said.

Italian press reports estimated the transaction’s value at around 800 million euros ($1.07 billion).

However, a second source told Reuters that the value of the new company, which will be called AssetCo, will be between 400 and 500 million euros, given that Edison will take back some of the electricity produced by the firm and keep part of the profit.

Edison has been looking to offload a majority stake in its wind power business to fund greater expansion in the renewable segment.

Italy’s No.2 wind operator behind Erg, Edison is keen to play a part in the consolidation of Italy’s fragmented renewable energy sector. The segment has been boosted until recently by generous state subsidies.

Under Italian law, power produced from renewable energy has dispatching priority to the national grid, guaranteeing the power is sold.

Erg became Italy’s biggest player in renewables last year when it bought 80 percent of IP Maestrale from GDF Suez in a deal worth 859 million euros, or 1.35 million euros per megawatt. ($1 = 0.7455 Euros) (Reporting by Massimo Gaia; Writing by Oleg Vukmanovic; Editing by Paola Arosio)

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