CVC enters Gas Natural with €3.8bn deal

Private equity group CVC has bought a 20 percent share in Spanish utility Gas Natural Fenosa in a deal worth €3.8 billion.

The firm has bought the share from Spanish oil group Repsol and joins Global Infrastructure Partners (20 percent) and investment group CriteriaCaixa (24.4 percent) as the listed utility’s major shareholders.

The deal saw CVC pay Repsol €19 per share, meaning it has invested on the same terms as when GIP spent €3.8 billion to acquire its share in September 2016. CVC pursued its investment through its €15.5 billion flagship private equity fund, which closed in June last year.

The group abandoned a move to raise a €2 billion infrastructure fund in 2013, after securing only around €200 million. It has since set up a €4 billion Strategic Opportunities Platform designed to “invest for the long term in stable, high-quality businesses”, according to CVC. The fund was used for its 25 percent acquisition of oil storage company CLH in April, in addition to investments in UK motorway services operator Moto and roadside assistance group RAC.

Gas Natural two weeks ago posted a 16.1 percent fall in EBITDA in 2017, which it attributed to “interruptions in the gas distribution and marketing businesses” in Italy, Colombia, Moldova and Kenya. The company also undertook a number of divestments last year, selling 20 percent of its Spanish gas distribution business to CPPIB and Allianz for €1.5 billion, divesting its Italian gas assets for €1 billion in October to 2i Rete Gas and Edison and its Colombian gas distribution stake to Brookfield for €482 million.

Further sales are underway in Moldova and Kenya.