Iberdrola buys UK distributor ENW for 5 billion euros

Iberdrola has taken a giant step in the UK with the purchase of 88 per cent of the British electricity company Electricity North West (ENW) for 2.1 billion pounds (around 2.5 billion euros), a value that rises to 5 billion euros including the company's debt, for which an alliance formed by the French company Engie and the Canadian fund CDPQ was also bidding.

The remaining 12 per cent of the company is held by a group of Japanese investors led by Kansai, with whom Iberdrola has signed a long-term shareholder agreement.

With this operation, the United Kingdom becomes the company's leading country in terms of network asset base, with around 14 billion euros, followed by the United States with 13.3 billion euros. The two countries together account for two thirds of the group's network assets, as detailed by the company in a statement sent to the Spanish national securities market commission (CNMV).

"With this transaction we continue our commitment to investments in electricity grids, a fundamental factor for the electrification and decarbonisation of the economy, and to countries with ambitious investment plans that have stable and predictable regulations," said Iberdrola Chairman Ignacio Galán in a subsequent statement.

ENW distributes electricity to almost five million customers in the northwest of England, in cities such as Manchester, Lancaster and Barrow, and has 60,000 kilometres of electricity distribution networks. The acquisition means that Iberdrola will be the second largest regulated electricity transmission and distribution company in the region, serving 12 million people and more than 170,000 kilometres of networks in total. It will also employ more than 8,500 people across the country.

Iberdrola acquired its UK subsidiary Scottish Power in 2007, in line with its long-term strategy to be a world leader in the global energy market. Since then, the company has enjoyed high growth and is the only vertically integrated energy company in the country.

Scottish Power is one of the largest investors in renewable energy in the country, and owns and operates the South of Scotland transmission network and distribution networks in South Central Scotland and Merseyside, North Wales and Cheshire.

Iberdrola currently has more than 111,400 km of power lines installed in the country and 40 onshore and two offshore wind farms in operation, with a total renewable capacity of more than 3,000 MW that supplies the equivalent of more than two million homes. This allows it to generate 100 per cent emission-free energy.

As part of its growth plans, the company is building the East Anglia Three offshore wind farm, the second largest in the world, with a total capacity of 1,400 MW.