The French Engie and Crédit Agricole acquire the Spanish Eolia Renovables

Adds fund, shares

PARIS / MADRID, November 11 (Reuters)Gas and electricity group Engie ENGIE.PA and the French bank Crédit Agricole CAGR.PA announced Thursday that it had agreed to buy the Spanish renewable energy group Eolia Renovables.

The deal highlights the growing investor appetite for renewable energy assets in southern Europe, leading to higher market valuations in the sector.

The French companies said in a joint statement that they had agreed to buy 97.33% of the capital of Eolia Renovables from the Canadian investment fund Alberta Investment Management Corporation. They did not disclose the financial details of the purchase.

But a source familiar with the matter told Reuters the transaction’s enterprise value barely exceeded € 2 billion.

The former French gas monopoly Engie this month announced the sale for 7 billion euros ($ 8 billion) of the technical services group Equans to Bouygues BOUY.PA and said he would use the proceeds from the sale of assets to invest in renewables.

Much of Eolia’s assets were built in accordance with previous Spanish regulations which still guarantee a long-term fixed rate for the electricity they generate.

Engie, whose share was up 2.6% at the start of the Paris stock exchange, will hold 40% of the assets of Eolia and 60% Crédit Agricole.

($ 1 = 0.8648 euros)

(Reporting by Gwenaelle Barzic and Isla Binnie; Writing by Michel Rose; Editing by David Goodman and Alexander Smith)

((sarah.morland@thomsonreuters.com; +48 58 769 65 92;))

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