Eni plans to divest minority stakes in new retail and renewable businesses next year

China Petrochemical News Net, according to a report from ICIS-MRC website in Moscow on May 19, according to Reuters a few days ago, Italian energy group Eni plans to divest a minority stake in its new retail and renewable energy business next year.

Several European energy companies, including Spain's Repsol, plan to divest part of their renewable energy business to raise funds to reduce debt and provide funding for the shift from oil and gas to other energy sources.

Analysts at Jefferies said that the business, which has 10 million customers and plans to increase green power generation to more than 5 GW by 2025, may be worth 9 billion euros (approximately US$10.

Francesco Gattei, the company's chief financial officer, said in a conference call with analysts that the merger of the two companies may clearly bring the company's (EBITDA) P/E ratio to double digits.

As the increase in oil prices offset the decline in production, Eni's adjusted net profit in the first quarter increased nearly five times to 270 million euros (327 million US dollars).

The large-scale blockade due to the epidemic last year restricted fuel demand, prompting energy groups such as Eni Group to control investment and returns.

The group said it is looking for acquisition opportunities to expand its green business, increasing its renewable energy production capacity from 1 GW this year to 4 GW in 2024, and will focus on the United States and Southern Europe.

Hao Fen translated from ICIS-MRC

The original text is as follows:

Eni to spin off minority stake in its new retail and renewable business

Italian energy group Eni is planning to spin off a minority stake in its new retail and renewable business next year, after announcing first quarter profits that missed expectations, reported Reuters.

Several European energy companies, including Spain's Repsol, aim to divest parts of their renewables business to raise money to reduce debt and pay for the shift away from oil and gas.

Analysts at Jefferies said the business, which has 10 million customers and plans to grow green power generation to over 5 gigawatts (GW) by 2025, could be worth EUR9 billion (USD10.

"The combination of these two entities clearly could move the vehicle to the range of a double-digit multiple (to EBITDA)," CFO Francesco Gattei said on a call with analysts.

In the first quarter, Eni's adjusted net profit jumped almost five times to 270 million euros (USD327 million) as firmer oil prices offset lower production.

Pandemic lockdowns throttled fuel demand last year prompting energy groups like Eni to rein in investments and returns.

The group said it was looking for acquisitions to grow its green business to reach 4 GW of renewable capacity by 2024 from 1 GW this year, with a focus on the US and southern Europe.