The Diplomat
The Council of Ministers yesterday authorised, subject to conditions, the voluntary and partial takeover bid by the Australian fund IFM to acquire up to 22.69% of Naturgy’s share capital.
At the press conference following the meeting of Pedro Sánchez’s Cabinet, the third Vice-President of the Government and Minister for Ecological Transition and the Demographic Challenge, Teresa Ribera, said that this is a “unique” operation on a company that is “strategic”, and that, despite “welcoming” foreign investment, it should be conceived as an “opportunity to help consolidate the regulatory framework and the energy transition with robustness” and with “guarantees and caution”.
Specifically, the approval of IFM’s operation to enter the capital of Naturgy, approved at the proposal of the Ministry of Economic Affairs and Digital Transformation, is conditional on the fund having to support the company’s investments in energy transition projects in Spain within five years of the settlement of the takeover bid, as well as maintaining the company’s domicile and headquarters in Spain and “a significant part” of the workforce in Spain, reports Europa Press.
In addition, IFM must support a “prudent” dividend policy and an external debt policy that allows it to maintain this ratio, without exceeding the levels recommended by the National Commission for Markets and Competition (CNMC). Likewise, IFM will not be able to support any divestment proposal other than those reflected in the strategic plan to be submitted and which involves losing control of the subsidiaries with which the group carries out its strategic activities in Spain.
Nor will it be able to support the exclusion of Naturgy from the Spanish stock exchanges for the next three years. IFM’s failure to comply with the conditions will result in the revocation of the investment and will be a “very serious” infringement, Ribera said. IFM filed in early February with the Spanish Securities and Exchange Commission (CNMV) the application for authorisation, including the prospectus, of its voluntary and partial public offer to acquire up to 22.69% of Naturgy’s share capital.
The operation, in addition to the approval of the CNMV, had to have this authorisation from the Council of Ministers, due to the “golden parachute” regulation approved last year by the Government for the Covid-19 crisis, which allows the Executive to veto the purchase by a foreign investor of more than 10% of a Spanish company in a strategic sector.
