SODENA :: Nuestras inversiones

A leader in its commitment to renewable energy sources

Type of investment: start-up.

The Government of Navarre has disinvested in Corporación EHN now that the regional wind energy map has been completed.

ACCIONA, the company that acquired the Government's participation, presented the operation to the Spanish Securities and Exchange Commission (CNMV) on 29 October 2005.

The Government of Navarre, through SODENA, has brought its participation in Corporación Energía Hidroeléctrica de Navarra (EHN) to an end now that the region's wind energy plan has been completed.

After a 15-year-long participation in EHN (since 1989) that has enabled the creation, development and consolidation of the renewable energy sector in Navarre, the Government of Navarre has sold its share package (39.58% of the capital) to the ACCIONA business group (already the major shareholder) in an operation presented before the Spanish Securities and Exchange Commission (CNMV) this morning.

Navarre has over 1,000 wind turbines in operation.

" SODENA promoted the creation of EHN and has supported every single initiative of the company over the last twelve years. This has meant that Navarre is now an international benchmark in the development of renewable energies and EHN has consolidated itself as one of the leading companies in the world in this field.

It has also propitiated the creation of a large industrial sector in the region linked to clean energies, as well as technological developments that have consolidated Navarre as an international centre of excellence in renewable energies".

Esteban Morrás
Chief Executive Officer, EHN

The agreement, subject to approval by the competition authorities, stipulates a cash payment of 307 million euros for the purchase, which could rise to a maximum of 321, on the basis of the results achieved by EHN in the 2005 and 2006 financial years. The price por parto of this share package, discounting the equity effect, is approximately 5% higher than that paid by ACCIONA for 50% of the capital one year ago.

A purchase and sale option agreement (which will become due in 2005) has also been reached with Caja Navarra on the remaining 10.42% of the company. As a result, a decision on this purchase will be made sometime next year. In any event, the price set for the present acquisition operation of the 39.58% will be maintained.

The Government of Navarre’s assessment

" I consider that the presence of public capital in EHN has been decisive in the balanced industrial and economic development in Navarre In recent years. The strategic vision of the territorial administration of Navarre in the 1990s in favour of renewable energy sources has meant that Navarre now plays a leading role in this sector", says José Javier Armendáriz, Regional Minister of Industry and Technology, Commerce and Employment, and also President of SODENA.

The Government of Navarre has taken the decision to disinvest because it considers that the objectives set for EHN in the past within the general interest of Navarre have been achieved and amply surpassed. The exit of SODENA from Corporación EHN takes place at a time when Navarre's wind energy map is completely covered: the last two windparks (Codés and Falces) will be operational in early 2005. The production of electricity from renewable energy in Navarre has shown spectacular increases in the last fifteen years, going from 272,511 MWh in 1989 to 2.15 million in 2003.

There are now 28 windparks in Navarre with around 1,000 wind turbines, and the energy development model of the Government of Navarre –based on generation from renewable energies- has become a benchmark for several countries. The reduction in CO2 emissions between 2002 and 2003 is above 8,130 million tonnes. At present, the energy produced from renewables in Navarre covers more than 60% of the region's electricity demand.

The future of Corporación EHN in the next few years lies in international markets, which would mean new risks for SODENA and the regional administration, and a major economic effort in a sector that is clearly attractive to private investors.

SODENA and renewable energies

Since its creation in 1984 SODENA ha participated in 66 business projects. The total paid-up capital in these project, plus loans and warranty granted, is over 162.5 million euros. Operations in progress or concluded by SODENA in the last ten years have had a direct effect on 5,300 jobs.

Depending on the characteristics of each project, the participation and intervention of SODENA in a company usually ranges between 4 and 6 years. The case of EHN is the only one in which SODENA has remained involved for more than ten years.

As a venture capital company, it participates in business projects and then disinvests after a certain period in order to invest in new projects and sectors in which there is a lack of private investment and the risk is high. SODENA has only invested in Navarre, and directly for the society of Navarre.

SODENA will continue to participate actively in the development of renewable energies in the region through the new Energy Plan for Navarre, a process already set in motion by the Government of Navarre through the Department of Industry and Technology, Commerce and Employment. Nowadays the renewables sector employs over 3,600 people in the region.

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