Snam To Acquire 100% Stake In Infrastrutture Trasporto And 7.3% Stake In Terminale GNL From Edison For US$262.1 Million

Published: Jul 25 2017
Deal Summary

Snam SpA, a natural gas infrastructure company, entered into definitive agreements to acquire 100% stake in Infrastrutture Trasporto Gas S.p.A. (ITG), an owner of the Cavarzere Minerbio gas pipeline; and 7.3% stake in Terminale GNL Adriatico (Adriatic LNG), a company that owns the regasification terminal in Rovigo, from Edison SpA, a company owned by Electricite de France S.A., for a purchase consideration of €225 million (MM) (US$262.13 MM), subject to price adjustment at closing.

ITG built and operates the 83km Cavarzere Minerbio gas pipeline, connecting the Adriatic LNG’s regasification terminal to the Snam Rete Gas national transport network. The pipeline has a transport capacity of 9.6 billion cubic meters per year.

Adriatic LNG operates a regasification terminal located in the northern Adriatic Sea, offshore Italy and began its operations in the second half of 2009. The terminal has a regasification capacity of 8 billion cubic meters per year. The terminal facilitates import of LNG from five countries; primarily from Qatar but also from Egypt, Trinidad and Tobago, Equatorial Guinea, and Norway.

Currently, the partners in the Adriatic LNG’s regasification terminal are ExxonMobil Italiana Gas S.r.l. (70.7%); Qatar Terminal Company Limited (22%); and Edison (7.3%). Following the completion of the transaction, the partners in the Adriatic LNG’s regasification terminal will be S.r.l. (70.7%); Qatar Terminal (22%); and Snam (7.3%).

The transaction will enable Snam to expand its midstream business operations.

The transaction is expected to be completed by the end of 2017, subject to the approvals required for this type of transaction and, with regard to the Adriatic LNG equity investment, it is conditional upon non-exercise of the right of pre-emption by the other shareholders.

Marco Alvera, CEO of Snam, said, “This investment enables us to strengthen our infrastructure in Italy as well as exploit new synergies in the integrated management of the gas system, adding a significant pipeline to our network and connecting a strategic entry point that was not under Snam’s control.”

The transaction implies values of US$0.28 per cubic feet of daily pipeline installed capacity and US$26.06 per barrel of installed storage capacity.

Deal history

Announced: On July 25, 2017, Snam agreed to acquire 100% stake in ITG and 7.3% stake in Adriatic LNG, from Edison, for a purchase consideration of €225 MM (US$262.13 MM).

Update: On June 19, 2017, Snam is in talks to acquire a 7.3% stake in Terminale GNL, according to two sources familiar with the matter said.

Planned: On June 9, 2017, Edison intends to sell its 7.3% stake in Terminale GNL.

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