Sorgenia, the Sixth Street giant ready to bid for 40%

The reorganisation of Sorgenia is close to completion. The procedure initiated by the controlling shareholder F2i to take in a minority shareholder, with just over 40% of the capital, is now in the final straight and in pole position is the giant Sixth Street, which in Italy in 2022 had already taken over 49% of Enipower (Eni's combined cycle power stations). A binding offer from the international investment company is expected shortly, subject to the technical timescales and procedural procedures envisaged, and it is the shared opinion of market participants that it will prove to be a winner, barring any last-minute twists and turns of course.

In reality, at stake is not only a minority stake in Sorgenia. In fact, the procedure overseen by Mediobanca, Lazard and Banca Imi envisages that the investor will take over a stake in the new entity, a veritable energy hub in which, in addition to Sorgenia itself, Ef Solare, which is also 70% controlled by the fund led by Renato Ravanelli (the remaining 30% belongs to Credit Agricole), will also be involved. In short, in addition to around 1 million customers between retail, business and micro enterprises, four combined cycle plants for over 3 GW and a good package of wind power, the new entity will be able to count on more than 1 GW of photovoltaics, mainly between Italy and Spain. For this reason, the value of the operation could be - as previous rumours have already shown - around EUR 1 billion. At the same time, the Asterion fund, which had taken over 27% of the shares of the energy group during the previous reorganisation, when the banks ceded control to F2i, will leave the capital of Sorgenia. Moreover, Asterion is involved in two other key transactions in Italy: it is preparing to close on 49% of 2i Aeroporti (sold by Ardian) and in the coming weeks, in tandem with the Mef, it will formulate a binding proposal for Sparkle to Tim.

Even for Sixth Street, if it actually enters Sorgenia, it will not be the first transaction in Italy, given that in 2022 it had bought 49% of the combined cycle power plants controlled by Enipower from Eni. Both deals have a purely financial logic for the fund, although the one on F2i's new energy hub - on closer inspection - is more exposed to fluctuations, either positive or negative, in the market. Sorgenia itself, mainly due to the lack of numerous incentives, closed 2023 with a sharp drop in profits (although the multiples on debt remain well within the sector average) and the prospects for its gas-fired power plants in the medium term - some observers note - are less bright than a few years ago. On the other hand,' the market points out, 'the potential synergies and the strong complementarity of the supply chain represented by combined cycles, renewables and end customers remain extremely relevant, particularly for a country like Italy where the weight of thermal power in electricity generation is and will remain significant for some time to come.

One thing is certain. What 10 years ago was a company on the brink of the abyss (1.8 billion in debt) is now the linchpin of one of the country's major energy reorganisations and tomorrow could participate, it remains to be seen in what role, in further market consolidation.