Italgas to Buy 2i RETE Gas for $5.82 Billion

Italgas, the European leader in gas distribution, with unique capabilities of innovation, digitalization and investment, on Monday said that it will acquire 2i Rete Gas for an enterprise value of $5.82 billion, with a 4% premium on the 2025 expected Regulatory Asset Base (RAB) and closing expected within the first half of 2025.

The consideration is $2.26 billion, while the net financial debt and other net liabilities of 2i Rete Gas as of the end of 31 December 2023 amount to $3.56 billion.

F2i and Finavias have signed the agreement to sell 2i Rete Gas to Italgas. F2i currently holds 63.9% of 2i Rete Gas and Finavias, a corporate vehicle owned by the Netherland’s APG Asset Management and funds managed by Ardian, holds the remaining 36.1%. 

Presenting the Strategic Plan for 2024-2030 to analysts and investors, Italgas CEO Paolo Gallo said the company plans to invest $17.14 billion over the plan period, with an increase of $8.24 billion (+92% compared to the previous plan) and aimed at the acquisition of 2i Rete Gas, interventions for the development of gas distribution in Italy and Greece, strengthening the presence in the water sector, and accelerating the growth in energy efficiency, with a strong commitment to achieving EU climate targets.

Italgas, Italy’s second-largest natural gas distribution operator, emphasised its commitment to consolidating the gas distribution sector in Italy with the aim of multiplying synergies to ensure significant benefits for families and businesses in terms of safety, efficiency, service quality, decarbonisation of end uses, and costs.

The use of artificial intelligence (AI) across all Group activities will also enable a new phase of digital transformation, accelerating the ecological transition, Gallo said.

The Group will continue to benefit from a solid and efficient financial structure, with a commitment to maintaining the current credit rating. The expected synergies and operational efficiencies allow for a forecast of double-digit net income growth over the plan period.

“Therefore, it has been possible to raise the floor of the dividend policy until 2026, ensuring a growth rate of 5% annually starting from the dividend 2023 of $0.39 per share, while also confirming the 65% pay-out.

EPS accretion starting from 2026, including the expected capital increase, reaching approximately 15% in 2029.

Becoming Champion in Gas Distribution

Gallo said that the Strategic Plan 2024-2030 will go down in the company’s history as the blueprint for creating the European champion in gas distribution, further reinforcing our commitment to the digital transformation of infrastructure, benefiting the entire country.

He also said that the new scale of the Group, combined with innovation and digital transformation, is the decisive factor in ensuring we meet the targets of the energy transition, the security of supply and the sustainability of energy costs for individuals and businesses.

An investment of $17.14 billion will provide a strong boost to our growth trajectory, with the largest share once again allocated to the development, digitisation, and repurposing of the gas distribution network in both Italy and Greece.

“Digital transformation remains the primary strategic lever also for strengthening our activities in the water sector and energy efficiency. With $824.11 million, we will continue to work towards enhancing our role as a key player in water — which has long suffered from a lack of adequate smart investments in networks — and to grow in energy efficiency as an essential tool for achieving energy transition goals,” he said.

The figures in this Plan, with an average annual growth of 13% in EBITDA and net profit by 2030, demonstrate how the extraordinary capabilities of the women and men of Italgas and 2i Rete Gas can create value for shareholders and all stakeholders, leveraging efficiency, innovation, and sustainability, he added.