By Mauro Orru

Enel SpA's subsidiary Enel Produzione SpA has signed an agreement to acquire ERG Hydro Srl and its portfolio of hydroelectric plants, in a deal that bolsters the group's installed renewable capacity in Italy.

The Rome-based energy company said late Monday that the agreement between Enel Produzione SpA and ERG Power Generation SpA, which owns ERG Hydro, is based on a consideration of 1.04 billion euros ($1.23 billion) for an enterprise value of EUR1 billion.

The company will fund the acquisition through cash flows from current operations and existing debt capacity.

ERG Hydro owns a portfolio of hydro plants for an installed capacity of 527 megawatts, consisting of 19 hydro plants and seven micro hydro plants. It also has seven large dams and four reservoirs.

Enel expects to close the transaction at the beginning of 2022, taking its installed hydro capacity in Italy to about 13 gigawatts and its total renewable capacity to about 14.5 gigawatts.

Write to Mauro Orru at mauro.orru@wsj.com; @MauroOrru94

(END) Dow Jones Newswires

August 03, 2021 02:31 ET (06:31 GMT)

Copyright (c) 2021 Dow Jones & Company, Inc.
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