Italy's Eni to list retail-renewable unit minority stake

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Eni's logo is seen in front of its headquarters in San Donato Milanese, near Milan, Italy, April 27, 2016. REUTERS/Stefano Rellandini

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MILAN, Oct 7 (Reuters) - Italian energy group Eni (ENI.MI) has decided to list a minority stake in its new retail and renewable business next year to help fund its shift away from oil and gas.

In April the group approved the launch of a strategic project to either list or sell a stake in the unit.

"An IPO (initial public offering) will unlock significant value, positioning the business for growth and helping both Eni and its customers reach net zero emissions," Eni CEO Claudio Descalzi said in a statement.

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In February, Eni raised its climate ambitions with a pledge to be carbon neutral by 2050, as it seeks to keep pace in an industry under pressure from investors and regulators to curb emissions. read more

It has said it expects its oil production to peak in 2025.

Several European energy companies, including Spain's Repsol (REP.MC), are looking to divest parts of their renewables business to raise money to cut debt and fund the energy transition.

Eni, which said it would hold a Capital Markets Day on Nov. 22, said it would keep a majority stake in Eni R&R but did not say how much it would sell.

The deal will be completed next year subject to market conditions, it said.

The business, which includes renewable power generation and energy sales to customers, could be worth around 10 billion euros ($11.6 billion), a source previously told Reuters.

A spinoff would double trading multiples and give Eni scope to raise 2-3 billion euros of debt, away from its balance sheet to fuel its green drive, the source said.

Eni R&R, which aims to develop more than 6 gigawatts of renewables capacity by 2025, expects its core earnings to reach 1.2 billion euros in 2025 from 0.6 billion euros seen this year.

($1 = 0.8653 euros)

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Reporting by Stephen Jewkes; editing by Barbara Lewis

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