BBVA Corporate & Investment Banking has acted as sole financial advisor to the Ireland's premier electricity utility ESB and japanese energy supplier Osaka Gas in the disposal of Bizkaia Energia, S.L. to US energy-focused investment firm ArcLight Capital.
The sale of Bizkaia Energía, S.L, owner of the Boroa CCGT plant in Amorebieta (Vizcaya, Spain), has been possible due to BBVA expertise in the energy sector, which also provided contacts to a large number of investors from all around the world.
The sale by ESB forms part of the divestment programme of non-core generation assets required by its ultimate shareholder, the Government of Ireland, so as to meet the commitments reached within the program of financial support received by this country. For Osaka Gas, the disposal allows to realign its portfolio according to their international strategy.
BBVA, awarded "Best Investment Bank in Spain" in the Global Finance Awards 2014, provided ESB and Osaka Gas with a full range of financial advisory services such as valuation analysis, Due Diligence coordination and contract negotiation advice.
This transaction shows once again BBVA's second to none local M&A capabilities in Spain. Bizkaia Energia, S.L. was a challenging asset to sell given that i) CCGTs in Spain were running at load factors close or even below 10% and ii) there was a changing energy regulatory environment in the country that spooked most international investors. However, BBVA international network proved its ability to reach out to a very broad investor base (close to 150 potential buyers contacted through BBVA Financial Sponsors Group and BBVA Red Exterior).