Iberdrola Agrees to Sell Scottish Power Generation to Drax Group for GBP702 Million -- Update
16 October 2018 - 6:15PM
Dow Jones News
(adds Drax guidance on transaction impact, details on asset
sold, expected date of close of transaction)
By Cristina Roca
Iberdrola SA (IBE.MC) said Tuesday that it has agreed to sell
its Scottish Power Generation Holdings Ltd business in the U.K. to
Drax Group PLC (DRX.LN)'s Drax Smart Generation Holdco Ltd.
The energy company based in Bilbao, Spain, will sell 100% of
Scottish Power's capital to Drax for GBP702 million ($922.3
million) in cash.
Iberdrola said it expects the sale to have a positive impact on
its 2018 earnings, which will be quantified and announced when the
transaction closes.
To finance the acquisition of Scottish Power, Drax has entered
into "a fully-underwritten GBP725-million secured acquisition
bridge facility agreement," the British electrical power company
said in a statement.
Drax said it expects Scottish Power to Generate Ebitda of
between GBP90 million and GBP110 million in 2019, and the
acquisition will enable it to pay "a growing and sustainable
dividend."
Scottish Power currently has a total capacity to generate 2,566
megawatts of electricity, Iberdrola said. Drax said Scottish
Power's portfolio of pumped storage, hydro and gas-fired generation
assets will significantly expand its low-carbon, renewable
generation model.
The sale should be completed on Dec. 31, Drax said, conditional
upon approval by Drax's shareholders and the UK Competition and
Markets Authority.
Write to Cristina Roca at cristina.roca@dowjones.com;
@_cristinaroca
(END) Dow Jones Newswires
October 16, 2018 03:00 ET (07:00 GMT)
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