Edison divests its gas transmission network

Public disclosure required by Consob Resolution No. 11971 of May 14, 1999, as amended. Edison sells its gas transmission network and absorbs five subsidiaries. The buyer is Clessidra, an Italian private equity fund managed by Clessidra Sgr.

Milan, August 02, 2004 - On July 30, 2004, Edison signed a contract selling its gas transmission operations to Clessidra, an Italian private equity fund managed by Clessidra Sgr. The fund acquired 100% of Edison T&S, a company that owns Edison’s demerged gas storage operations, and its subsidiary SGM.

Edison will continue to operate the transmission network under a management contract.

The computation of the sales price was based on an enterprise value of 195 million euros for 100% of the capital stock both of Edison T&S and SGM. The final transaction amount will be determined at the closing, which is scheduled for the beginning of September 2004.

The transaction was carried out with the support of Banca Imi and Cleary Gottlieb (for Edison) and Mediobanca (as advisor to Clessidra).

The gas transmission network that Edison is selling consists of about 1,300 kilometers of high-pressure gas pipelines. It includes: the “Cellino” network in the Marche, Abruzzo and Latium regions; the Collalto gas pipeline in the Veneto region; the Garaguso network in the Basilicata region; the Cirò network in the Calabria region; the Comiso network in Sicily; and the SGM network, which connects the regions of Latium and Puglia and crosses the Molise and Campania regions.

In 2003, the gas transmission operations of Edison T&S and SGM generated revenues of about 27 million euros.

In a separate transaction completed on July 31, 2004, Edison executed a deed of merger absorbing Bussi Termoelettrica, Caffaro Energia, Sogetel, Vega Oil and Savim. The merger will become effective vis-à-vis third parties on September 1, 2004, but will be implemented for reporting and tax purposes as of January 1, 2004. The absorbed companies were all direct, wholly owned subsidiaries of Edison, which exercised management and control over them. Counting this transaction, Edison and its subsidiaries have absorbed a total of 35 companies during the past two years.