EDRVY EDP Renovaveis SA (PK)

   By Nathan Allen and Alberto Delclaux 
 

Engie SA (ENGI.FR) said Tuesday that it isn't currently preparing a takeover bid for Portuguese renewable-energy company EDP Renovaveis S/A (EDPR.LB), following speculation about a potential deal.

Engie said it hasn't taken any decision in relation to EDP Renovaveis and wasn't preparing an offer. But Engie said it is "constantly assessing investment opportunities," after Bloomberg reported Monday that the French energy company was considering a bid for all or part of EDPR, which is 82.60% owned by EDP-Energias de Portugal SA (EDP.LB), or EDP.

EDPR's parent company EDP is itself the subject of a takeover bid by its largest shareholder, China Three Gorges, or CTG, which has also proposed to take over the remaining shares in EDPR not owned by EDP. However, potential regulatory hurdles mean CTG may have to dispose of certain assets to win approval for its EDP takeover.

In its report, Bloomberg said some European utilities were showing interest in EDPR, and expect CTG to sell assets to get approval for its EDP deal. Engie is most interested in EDP Renovaveis's U.S. portfolio, but is also considering a full takeover bid, Bloomberg reported, citing unnamed sources.

Bryan Garnier analyst Pierre-Antoine Chazal, however, said it is more likely that Engie will team up with CTG to buy certain assets rather than launch a full bid for EDPR. Mr. Chazal points out that a full takeover of EDPR would complicate Engie's financial situation, adding that the company is mainly interested in the U.S. assets, a move that would make sense.

"The company does intend to increase its renewable footprint in the country with the U.S. only representing a rather marginal share of the group's overall earnings," says Mr. Chazal.

At 0840 GMT shares in EDP Renovaveis were up 3.2%, having earlier risen as much as 7.5%.

Write to Nathan Allen at nathan.allen@dowjones.com and Alberto Delclaux at alberto.delclaux@dowjones.com

(END) Dow Jones Newswires

June 26, 2018 05:17 ET (09:17 GMT)

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