Finmeccanica, which includes defence and aerospace interests, said the sale valued Ansaldo Energia at EUR1.23bn and would assist in fueling Ansaldo Energia's international growth.
First Reserve Corporation is a specialist investor in the energy sector, including companies in oil, gas and mining such as Glencore International.
Ansaldo Energia supplies power plant technology and services including gas turbines and nuclear power plant equipment.
The three advisors for Finmeccanica on the Ansaldo Energia deal were BNP Paribas (BNPP.FR), UniCredit (UCG.MI) and Intesa Sanpaolo's (ISP.MI) unit Banca IMI. First Reserve will get as much as EUR650m ($900m) of loans to fund its purchase of a stake in Ansaldo Energia.
Finmeccanica will be paid EUR95m in relation to a 25 year agreement licensing the use of the “Ansaldo” trademark as well as receiving a dividend payment of EUR65m. Finmeccanica will benefit from an improved consolidated net financial position by about EUR330m (pro-forma at 31 December 2010) and a capital gain net of taxes of about EUR450m.
Finmeccanica’s Board of Directors has approved the terms of the transaction, which is expected to be completed. The deal is expected to be completed before the end of the first half of 2011 and will bring to an end a prolonged search for a partner. Previous candidates considered by Finmeccanica included Japan’s Mitsubishi and Russia's Power Machines.
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