Renewable Energy M&A: Eni reportedly in talks to sell stake in retail and renewables unit Plenitude to Norwegian investor HitecVision

Private equity (PE) firm HitecVision may buy 5-10% of Plenitude, according to a source. Eni has been looking to bring on a partner in its renewables and retail unit since Jul '22, after it froze plans for an IPO of the business. The company cited “uncertain and volatile market conditions” as key reasons for delaying the move, but stated it has not dismissed the possibility of listing the unit entirely. At the time, RBC analysts valued Plenitude at up to €8.4bn, including debt, according to reports. As per Eni’s latest financial report, the business is on track to record €600mn of EBITDA in 2022, in line with its guidance for the year, while simultaneously reaching its target of installing 2 GW of new renewables capacity by the end of 2022.

Eni launched Plenitude in Nov '21 as a platform for its renewables, retail, electric vehicle (EV) charging, and energy services initiatives. The unit will invest ~€1.8bn annually during 2022 - 2025, mainly geared towards renewables activities which will account for more than 80% of the total capex. The investments will be funded by Plenitude’s cash flow and its own borrowings, with sufficient leverage capacity to achieve its targets independently from Eni. The unit’s 2025 targets include reaching €1.4bn in annual EBITDA, 6 GW of installed renewables capacity, 11 million retail gas and electricity customers, and 30,000 EV charging points. Beyond 2025, Plenitude targets to reach 15 GW of installed renewables capacity by 2030, increasing to 30 GW by 2035 and 60 GW by 2050. 

A potential sale to HitecVision would expand a long-standing relationship between the two companies. In the oil and gas sector, Eni and HitecVision have successfully cooperated on several projects offshore Norway through their Vår Energi JV. In Nov '20, the companies furthered their relationship with renewables and low-carbon space, forming Vårgrønn to develop projects in the Nordics. The JV targets to reach 1 GW of installed onshore renewables capacity and announced in Jun '22 that it aims to own 5 GW of operating and sanctioned offshore wind capacity by 2030, with a key focus on Northern European markets. 

The above analysis is proprietary to Enerdatics’ energy analytics team, based on the current understanding of the available data. The information is subject to change and should not be taken to constitute professional advice or a recommendation.