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Enel Said to Get Orders for All Shares in EGP's IPO (Update2)
2010-10-29 12:08:03.932 GMT
(Updates with analyst's comment in fourth paragraph.)
By Alexis Xydias, Zijing Wu and Elisa Martinuzzi
Oct. 29 (Bloomberg) -- Enel SpA has drawn orders for all
the shares on sale in the initial public offering of its
renewable-energy unit after cutting the price to lure investors,
two people familiar with the offering said.
Investors have agreed to buy all the shares, including
those on offer in the over-allotment option, said the people,
who declined to be identified before an announcement. The Rome-
based utility is selling as many as 1.6 billion shares in Enel
Green Power SpA for 1.60 euros to 2.10 euros apiece. The banks
will stop taking orders for the stock today.
Enel yesterday cut the price of the stock on sale, paring
EGP's valuation to as little as 8 billion euros ($11 billion)
from 9 billion euros, after investors said the unit was too
expensive relative to its competitors. Enel Chief Executive
Officer Fulvio Conti last month said he planned to raise at
least 3 billion euros from the unit's IPO to help cut debt. At
the bottom of the new range, the IPO will raise 2.56 billion
euros, including the over-allotment option.
Enel's price range is "now at a discount to peers," MF
Global analysts including John Karidis and Noel Culhane said in
a note to clients today. The IPO "looks attractive at the
bottom end" of the new range, they said.
Officials at Enel declined to comment. Companies typically
seek to draw orders for more stock than they're selling in an
IPO. Investors that receive less stock than they ordered then
buy shares on the market, helping to pushing the share price up.
At 1.6 euros a share, EGP's enterprise value is about 8.1
times its earnings before interest, tax, depreciation and
amortization, or Ebitda, according to the MF Global note. That's
less than Spain's Iberdrola Renovables SA, which trades at 9
times Ebitda, and EDP Renovaveis SA, which trades at 8.3 times,
the analysts wrote.
Iberdrola Renovables has tumbled 54 percent since its IPO
in December 2007, while EDP Renovaveis has dropped 48 percent
since going public in June 2008.
Bank of America Corp., Intesa Sanpaolo SpA's Banca IMI SpA,
Barclays Plc, Credit Suisse Group AG, Goldman Sachs Group Inc.,
JPMorgan Chase & Co., Mediobanca SpA, Morgan Stanley, UniCredit
SpA and Banco Bilbao Vizcaya Argentaria SA are managing Enel
Green Power's IPO.
For Related News and Information:
Renewable energy top page: GREEN <GO>
Top Italy stories: TOP IT <GO>
Top deal stories: TOP DEAL <GO>
--Editors: Edward Evans, James Amott.
To contact the reporters on this story:
Zijing Wu in London at +44-20-7330-7613 or zwu17@bloomberg.net.
Elisa Martinuzzi in Milan at +39-02-8064-4218 or
emartinuzzi@bloomberg.net;
Alexis Xydias in London at +44-20-7073-3372 or
axydias@bloomberg.net;
To contact the editors responsible for this story:
Daniel Hauck at +1-212-617-1697 or dhauck1@bloomberg.net;
Edward Evans at +44-20-7073-3190 or eevans3@bloomberg.net.
