Italy’s antitrust body blocks ERG’s 188 million euro sale of gas, hydro plant to Enel

The new logo of Italy’s biggest utility Enel is seen in Milan, April 17, 2016. REUTERS/Stefano Rellandini/File Photo

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Sept 23 (Reuters) – Italy’s antitrust regulator on Friday blocked the sale of renewable energy group ERG’s (ERG.MI) 188 million-euro ($182.17 million) unit, that housed its gas and hydro power plants, on competition concerns, ERG said in a statement.

ERG had agreed in February to sell the unit, called ERG Power, to utility Enel (ENEI.MI), as it looked to complete its transformation into a pure wind and solar company.

The regulator said a deal would have benefited Enel and would have eliminated or reduced competition in relevant markets, ERG said in a statement.

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ERG said it will evaluate a plan to divest ERG Power in the coming months.

The renewable energy company confirmed its year-end EBIDTA guidance range of 485 million euros to 515 million euros.

However, it updated its expected net financial position for the period to a range of 1.55 – 1.65 billion euros from 1.4 – 1.50 billion euros.

“In light of what has emerged, we will evaluate the possible options to valorise the asset as best we can while confirming the growth targets in our Industrial Plan,” Paolo Merli, ERG’s chief executive officer, said.

($1 = 1.0320 euros)

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Reporting by Gokul Pisharody in Bengaluru; Editing by David Gregorio

Our Standards: The Thomson Reuters Trust Principles.

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