Union Fenosa to be sold by “mid-September” – report

21 July 2008 – Spanish construction company ACS will put its 45 per cent stake in electricity group Union Fenosa on sale this week and hopes to close the deal by mid-September, a source close to the deal said, reports Reuters.

“The most likely option is that the deal will close in early September given the August holiday,” the source said.

Media had reported that ACS would auction its stake in Spain’s third largest utility – worth about €2bn ($3.2bn) at current market prices – on Monday and could close the deal by August.

EDF, Gas Natural SDG, RWE, EDP and ENI have been named as possible buyers.

ACS has said it wants to “consolidate” its position in rival utility Iberdrola, where it owns 7.2 per cent directly and a further 5.2 per cent via equity swaps.

Spanish newspapers have said ACS would use the proceeds of a Union Fenosa sale to buy more Iberdrola stock while analysts expect some of the cash to go towards cutting its net debt, which stood at €16.6bn at the end of 2007