Edison: BOD approves revision to the agreement for the sale of E&P to Energean

The company confirms the closing within the year: the transaction is in line with the company’s sustainable development plan.

Milan, April 2, 2020 – In relation to the agreement for the sale of 100% of Edison Exploration and Production (E&P) and its equity investments in the hydrocarbons (oil and natural gas) exploration and production sector to Energean Oil and Gas, and following the disclosure made on July 4 and December 23, 2019, Edison Spa’s Board of Directors, held today, approved certain amendments to the terms of the SPA (Sale and Purchase Agreement) agreed on July 4th last year including, first of all the exclusion of Edison E&P’s assets in Algeria from the perimeter of the transaction.

The transaction remains determined on the basis of an enterprise value of 750 million USD, which will be increased by an additional consideration of 100 million USD contingent on the commissioning of Cassiopea development gas project in Italy, while the following will be excluded from the consideration with limited impact:

• some fiscal benefits, whose likelihood of being used is considered uncertain;
• the accrual of interest on said consideration with effect from January 1, 2019 (reference date of the transaction) until the closing of the transaction itself.

In relation to the assets located in Algeria – which are fully operating since August 2018 - in compliance with the provisions of the Algerian authorities and in agreement with Sonatrach, Edison in order to continue with the plan to finalise the closing with Energean, decided to retain ownership of these assets, by initiating an intercompany transfer to exclude them from the perimeter of the sale. Following the intercompany transfer, the sale of the Algerian assets can be considered if the market conditions allow it.

The overall effect is estimated at a lower benefit of approximately 150 million USD in terms of change of the net financial position of Edison from the transaction.

Edison and Energean Oil and Gas confirm their desire to finalise the transaction and are continuing to work together by taking the necessary steps to satisfy the conditions set forth in the agreements reached last July. The closing of the transaction is confirmed as soon as possible in 2020.

The transaction falls under Edison’s sustainable development plan, which has put the central focus of its strategy on the following pillars: the generation of energy from renewable sources and latestgeneration gas, energy efficiency for companies, public administration, households and the final customer to whom to offer increasingly innovative services.

Edison Exploration and Production is responsible for all of Edison’s activities, mining titles and corporate shareholdings in the hydrocarbons sector in Italy and abroad. In particular, Edison E&P has a portfolio of roughly 90 licences in 8 countries in the Mediterranean and Northern Europe, corresponding to production of 46,000 barrels equivalent per day as at December 31, 2019.

Public disclosure requirements under CONSOB Resolution no. 11971 of May 14, 1999, as amended.