CVC, Others Exit Endesa Gas Grid Sale

MILAN/LONDON (Reuters) – Italian fund F2i and private equity firm CVC have pulled out of the bidding for Endesa SA’s (ELE.MC) gas grid, people familiar with the matter said, while M&G Investments said it had also dropped out.

Suitors recently entered indicative bids for the Spanish utility’s gas network, and remaining bidders are now preparing binding bids, two of the people said.

The bids could place a total enterprise value on the network of some 1 to 1.1 billion euros ($1.23 to $1.36 billion) when the stakes held by minority shareholders are taken into account, one source added.

Endesa is 92 percent-owned by Italy‘s Enel (ENEI.MI). Enel, Europe’s most indebted utility, aims to cut debt by nearly 6 billion euros to 45 billion this year.

F2i was set to bid with AXA Private Equity, the head of infrastructure at the French fund said in March. The AXA unit remains keen on the assets, one source said, but F2i has pulled out to “focus on Italian operations”, another said.

Rivals had seen the duo as strong contenders after they jointly bought 80 percent of Enel’s Italian gas grid last year.

A spokesman for Prudential’s (PRU.L) M&G confirmed that Infracapital — its infrastructure investing arm — was no longer pursuing Endesa but declined to comment further.

As of late May, interested financial investors also included infrastructure funds from Macquarie (MQG.AX), Goldman Sachs (GS.N), and BNP Paribas-sponsored (BNPP.PA) Antin Infrastructure Partners, sources close to the investors said then.

AXA (AXAF.PA), CVC [CVC.UL], Endesa, Enel and F2i declined to comment. Macquarie had no immediate comment.

Endesa’s network comprises 4,050 kilometres of gas distribution tubes and 859 kilometres of gas transport tubes covering several Spanish regions, including Aragon. ($1=.8101 Euro) (Reporting by Danilo Masoni in Milan and Zaida Espana in London; additional reporting by Quentin Webb, Simon Meads and Greg Roumeliotis in London, and Jonathan Gleave in Madrid; Editing by Louise Heavens)