Masdar, Endesa in $1.84b deal for renewable energy assets in Spain

Abu Dhabi Future Energy Company (Masdar), the UAE’s clean energy leader, announced on Friday that it has reached an agreement with Endesa S.A. (Endesa) to become a partner for 2.5 gigawatts (GW) of renewable energy assets in Spain, subject to regulatory approvals and other conditions.

The transaction would see Masdar invest €817 million (Dhs3.27 billion) to acquire a 49.99 per cent stake, with an enterprise value of €1.7 billion ($1.84 billion), representing one of Spain’s biggest renewable energy deals.

The portfolio Masdar plans to acquire consists of 48 operational solar plants of 2GW aggregated capacity.

Endesa and Masdar aim to add 0.5GW of battery energy storage system (BESS) to the projects.

The partnership reinforces Masdar’s reputation as a trusted global energy partner for governments, investors, developers, and communities.

The deal demonstrates Masdar’s commitment to accelerating the energy transition in Spain and Europe, and these solar projects will play an important role in supporting Spain to meet its National Energy and Climate Plan (NECP) and the EU’s net zero by 2050 targets.

In addition to the acquisition Share Purchase Agreement (SPA), Masdar and Endesa have signed a Memorandum of Understanding (MoU) to explore an alliance aimed at jointly developing renewable energy projects in Spain.

The deal reflects Masdar’s ambitious growth plans in Europe, having recently announced that it has reached a definitive agreement with Greece’s GEK TERNA SA and other shareholders of TERNA ENERGY SA to initially acquire 67 per cent of the company’s outstanding shares, subject to regulatory approvals and other conditions.

With a strong portfolio of projects in Greece and Europe, TERNA ENERGY is targeting a renewable energy operational capacity of 6GW by 2030.

In March this year, Masdar and Spain’s Iberdrola also reached a financial close on the 476MW Baltic Eagle offshore wind project located in the Baltic Sea off the coast of Germany.

Masdar’s existing presence in Spain includes the Almenara 1.2GW solar photovoltaic (PV) project in the Castilla la Mancha region of Spain currently under development.

Masdar is jointly owned by Taqa, Adnoc, and Mubadala; Endesa is a subsidiary of the Italian energy giant Enel.

Dr. Sultan Bin Ahmed Al Jaber, Minister of Industry and Advanced Technology, Chairman of Masdar and COP28 President, said, “Building on Masdar’s global expertise and pioneering approach to renewable energy innovation and development, this partnership underscores our commitment to unlocking clean energy capacity in Spain, Europe, and around the world, supporting the global mandate enshrined in the COP28’s UAE Consensus to triple renewable energy capacity by 2030 enabling a just, orderly and equitable energy transition. Masdar is accelerating its ambitious growth plans as we target 100GW of renewable energy capacity by the end of the decade.”

Flavio Cattaneo, CEO of Enel Group, said, “We are pleased that Enel, through its subsidiary Endesa, has started this partnership with a major player such as Masdar and, looking ahead, we hope that we will be able to carry out similar transactions in other geographies.”

Mohamed Jameel Al Ramahi, Chief Executive Officer of Masdar, commented, “By forging a strategic partnership in Spain with Endesa for 2.5GW of solar and battery storage assets, we are taking a significant step forward in our ambitious growth plans in one of Europe’s largest renewables markets.”

This deal with Endesa will play a significant role in supporting Spain and the wider EU in meeting their net-zero ambitions. We are delighted to also sign an MoU with Endesa to become their preferred partner for future solar projects.”

Masdar has retained BNPP as its transaction adviser, Linklaters as legal adviser, UL as technical adviser, PwC as tax adviser, and PexaPark as PPA adviser.

The acquisition was partially funded via acquisition financing from BNPP, Santander, Intesa, ADCB, FAB and SMBC. Lenders were advised by Ashurst.

Meanwhile Abu Dhabi Future Energy Company (Masdar), the UAE’s clean energy powerhouse, last week announced it has successfully raised $1 billion through its second green bond issuance, under its Green Finance Framework.

The announcement comes one year after the company’s first successful issuance of $750 million on the International Securities Market of the London Stock Exchange.

The issuance comprises dual tranches of $500 million each, with tenors of 5 and 10 years and coupons of 4.875 and 5.25 per cent respectively.

There was strong appetite from regional and international investors with the orderbook peaking at $4.6 billion, an oversubscription of 4.6x. Allocation was finalised with an average split of 70 per cent to international investors and 30 per cent to Mena investors.