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Repsol has made significant changes in the sale mandate of its subsidiary Renovables, a process that the company has commissioned JP Morgan as coordinating bank. The first Spanish oil company updated last December the terms of the operation, which for more than a year has been part of the strategic plan of the energy giant. Grupo Repsol is willing to increase the sale of its green subsidiary to 49%, compared to the range of between 10 and 25% that was initially considered, according to several financial sources familiar with the mandate consulted by La Información. The change has not diminished Repsol’s resistance when giving ground in management of Renewables before the eventual buyer.

the company he runs Joshua Jon Imaz is determined to maintain the sovereignty of the current management of the parent in the renewable subsidiary. This means that the energy group will impose on its future partner a passive role in the management of the green company even when he manages to enter the board of Repsol Renovables with the acquisition of a stake of up to 49% within the framework of the ongoing operation, according to what this medium has learned.

This ‘red line’ not only delimits the buyer profile that would fit in the operation, it also implies a comprehensive review of the very concept of the board of directors, highest corporate governance body of any company. The sources consulted indicate that Repsol is looking for a financial partner that will become what is known in jargon as anchor investor or anchor investor to which, according to the sources consulted, a prior percentage would be reserved for a future public offering for sale (IPO) of the renewable business.

The bid to incorporate a partner to the green subsidiary started just a month ago. The operation is key to shield the strategic shift being carried out by the group chaired by Antonio Brufau, aimed at consolidating its position as one of the main players of the ecological transition in Spain. The entry of an investor will serve to give the green business credibility in the market, since the oil company’s goal continues to be the IPO of Repsol Renovables.

The president of Repsol, Antonio Brufau, walked with the CEO of the company, Josu Jon Imaz

Last spring, when the renewable soufflé began to deflate after the IPO fiasco of Ecoener, which closed the day of its stock market debut with a drop of 15.25%, analysts recommended that Repsol wait to launch the IPO of its green business. The group’s green asset portfolio is dominated by projects greenfield still in development phase. The entry of an investor before the IPO will provide the financial muscle that the group needs to put a good part of these projects into operation, promoting the valuation of its renewables within the framework of an eventual jump on the stock market.

Repsol has taken advantage of the last few months to polish its renewable subsidiary, carrying out a kind of carve out al rremove certain assets from the perimeter of the division, specifically, those that were not entirely green. The sources consulted encrypt in the environment of the €3 billion future offers for the division for sale. The horizon managed by Repsol gives room for a revaluation of the green business, taking into account that the group aspires to increase its installed capacity to 20.000 MW in 2030. Accordingly, the company plans to raise the gross operating profit (ebitda) of Repsol Renovales until the 331 million in 2025.

Repsol expects to raise the Renewables EBITDA to 331 million in 2025 and the market estimates that the offers for the subsidiary will be around 3,000 million within the framework of the bid coordinated by JP Morgan

Repsol agreed transform the green subsidiary into a public limited company on January 14, which is a key step to speed up the entry of an investor. The bidding is still at an early stage. JP Morgan distributed the teaser, a document that collects the basic information on the subsidiary’s business, among potential buyers just over a month ago. The idea of ​​the group is receive non-binding offers in February of the candidates. The sector expects that the main investment and pension funds with a presence in Spain will attend the call, but not industrial groups, little interested in the purchase of minorities without management capacity.

Repsol is making progress in the search for a financial partner for the renewable subsidiary in parallel with the exploration of alliances for specific green assets, a strategy that the energy group has been running since last summer. The first milestone of this work was the entry of Pontegadea, the family office of the founder of Inditex, Amancio Ortega, in a wind farm, the first that Repsol has put into operation in Spain. The operation was settled with the disbursement of €245 million by Pontegadea to take the 49% of Delta.


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