Italgas, the main gas distributor in Italy, has signed an agreement to acquire its competitor 2i Rete Gas for a total of 5.3 billion euros (5.8 billion dollars), including debt. This acquisition, one of the largest in the sector, represents a significant step in the consolidation of the Italian gas distribution market, creating a major player in Europe.
Structured financing agreement
The transaction includes a bridge loan underwritten by JP Morgan and syndicated with a series of banks, including Banco BPM, BofA Securities, Citi, Morgan Stanley, and Société Générale. The financial arrangement is designed to maintain Italgas’ current credit profile while integrating a 1 billion euro capital increase to refinance this bridge loan.
Italgas’ expansion strategy
Paolo Gallo, CEO of Italgas, emphasized that this acquisition will create a European leader in gas distribution while strengthening the company’s strategic position in the European energy market. The operation is part of Italgas’ broader strategy to optimize its assets and capture more synergies by unifying distribution infrastructures in Italy.
Position of 2i Rete Gas and implications
One of the key aspects of this transaction is the purchase of the stakes held by F2i, Italy’s largest infrastructure fund, which controls 64% of 2i Rete Gas. The remaining 36% is held by the Dutch pension fund APG and the investment group Ardian, via the vehicle Finavias. The valuation of the operation reflects 2i Rete Gas’ status as the second-largest gas distributor in the country.
Regulation and market impact
Strategically, the agreement comes at a time when the gas distribution sector is subject to strict regulation by the Italian energy authority, which sets gas transportation tariffs and investment returns. Consequently, the operation could have a significant impact on gas distribution costs and tariffs for end-users depending on the evolution of regulations.
Consequences for the European market
This acquisition aligns with current trends in the European energy market, marked by increased consolidation, particularly in strategic infrastructures. The stakes of this transaction are also linked to Italgas’ ability to secure effective financing while managing the expectations of European regulators on issues of competition and governance of the energy market.
Ultimately, this transaction could not only redefine the Italian gas market but also position Italgas as a key player in gas distribution at the European level, while enhancing its bargaining power in a complex regulatory environment.
