15 November 2002 – The sale of Enel’s third and final generating group, Interpower, to the Energia Italiana – Electrabel – Acea consortium will not affect Acea’s ratings, according to Standard & Poor’s.

The Interpower group has an installed capacity of 2611 MW and power plants in Genoa, Naples, Civitavecchia and Vado Ligure and Enel accepted a second bid from the consortium of €551m including €323m in debt.

Standard & Poor’s Ratings Services said Thursday that, following preliminary discussions with Acea SpA’s management, its ratings on the Italy-based energy and water utility (AA-/Negative/A-1+) are unlikely to be affected by the company’s successful bid.

Acea, Italy’s largest municipal utility, has an ultimate 15 per cent share in a consortium of bidders–including Belgian The purchase will provide Acea with access to about 390 MW of capacity.

“The transaction should not materially affect Acea’s financial profile, given that the investment outlay is likely to be offset by the funds that Electrabel is expected to grant Acea in relation to the joint venture that the two companies are finalizing,” said Monica Mariani, a credit analyst in Standard & Poor’s Milan office.

The joint venture will cover electricity generation, supply, and trade, as well as gas supply, in Italy. Acea expects to receive about €250m from Electrabel by year-end 2002 in exchange for the assets conferred through the joint venture. In addition, about €30m of debt is expected to be deconsolidated. “From a business perspective, the higher risk deriving from increased involvement in generation activities is somewhat mitigated by the small stake to be held by Acea in Interpower and by resulting enhanced supply security,” added Ms. Mariani.

With its sale, Enel has completed, ahead of the December 31, 2002 deadline, the disposal of 15 057 MW mandated by the Bersani Decree. The total value of the sale of the three gencos is around €8.3bn.