ENCE: SELLS 49% OF ITS RENEWABLES SUBSIDIARY (ANÁLISIS BANCO SABADELL)
Sells 49% of its Renewables division excl. Thermosolar assets totalling 50 MW. BUY.The company will sell these assets to Ancala Partners for EV in which 100% is valued at € 886 M (€ 613 M for operating assets / € 2.3 M/MW + € 273 M in contingencies for the pipeline as projects are developed). The initial payment for the operating assets (excl. pipeline) is € 225 M for 49% and represents 37% of the company’s NFD’20e and 41% of market cap. The deal is pending approval at the AGM (14 Dec; 41% of the share capital has pledged to vote in favour). This is very positive news, as we valued the entire operation at € 455 M EV vs. € 613 M for this deal (not including the pipeline). Assuming these valuation levels, the impact on our T.P. would be +17% (+46% with the pipeline). Even if we assume this sale price for 49% and our valuation for the remaining 51%, the impact on the T.P. would be +8% (+23% with the pipeline).
Ence Energia Y Celulosa is engaged in the manufacture and commercialization of wood pulp and derivatives. Co. divides its activities into the following two business lines: Forest Division: Co. manages timberlands in South America and the Iberian Peninsula. Co. is involved in trading of wood, and supplies solid wood products including: plywood, sawn timber, parquet flooring and glued-edge paneling. Co. is involved in forest and environmental consulting. Pulp Division and Energy Production: Co. is engaged in the production of Eucalyptus globulus-based TCF and ECF paper pulp. Co. is also involved in the generation of electricity through biomass power producing plants.
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