Iberdrola acquires majority stake in Electricity North West, increasing its involvement in the UK market

(IN SHORT) Iberdrola has acquired an 88% stake in Electricity North West (ENW) in the UK for £2.1bn (€2.5bn), reinforcing its commitment to investing in countries with strong credit ratings. The acquisition makes Iberdrola the market leader in the UK in terms of its regulated asset base, valued at €14bn. Iberdrola now becomes the second largest electricity network operator in the UK, distributing electricity to around 12 million people. The acquisition is subject to regulatory approval and underlines Iberdrola’s strategic growth and commitment to renewable energy in the UK.

(PRESS RELEASE) BILBAO, August 3, 2024 — /EuropaWire/ — Iberdrola announced the acquisition of an 88% stake in Electricity North West (ENW) in the United Kingdom for an equity value of £2.1 billion (€2.5 billion). The transaction values the entire company, including debt, at around €5 billion. The acquisition is in line with Iberdrola’s strategy to invest in electricity networks in countries with high credit ratings, such as the United Kingdom, which has an AA credit rating.

Since the merger with ScottishPower in 2007, the UK has become a significant investment target for Iberdrola, with around £30 billion (€36 billion) invested to date. ScottishPower is the only 100% green integrated utility in the UK. The acquisition makes the UK Iberdrola’s leading market in terms of regulated asset base, now valued at around €14 billion, surpassing the US at €13.3 billion.

Ignacio Galán, Executive Chairman of Iberdrolahighlighted the strategic importance of the acquisition: “This transaction reinforces our commitment to significant investment in electricity networks, which are key to supporting the electrification and decarbonisation of the economy. The agreement is consistent with our strategy to invest in countries with ambitious investment plans and stable regulations. Our UK network regulated asset base currently stands at €14 billion, making the UK and US two-thirds of our total global regulated asset base.”

ENW serves almost five million people in the North West of England, including Manchester, Lancaster and Barrow, via some 60,000km of electricity distribution network. The acquisition positions Iberdrola as the UK’s second largest electricity network operator, currently distributing electricity to some 12 million people via over 170,000km of network and employing over 8,500 people in the country.

Iberdrola has entered into a shareholders agreement with a consortium of Japanese investors led by Kansai. The consortium will retain a 12% stake in ENW, which guarantees a long-term partnership.

The acquisition, pending standard regulatory approvals, underlines Iberdrola’s growth in the UK. The merger with ScottishPower in 2007 was a strategic move to establish Iberdrola as a global energy leader. A major investor in renewable energy, ScottishPower operates extensive transmission and distribution networks and serves 4.2 million customers in the UK.

Iberdrola’s operations in the UK include over 111,400km of power lines, 40 onshore wind farms and two offshore wind farms with a combined renewable capacity in excess of 3,000MW, enough to power over two million homes without emissions. The company is also building the 1,400MW East Anglia Three offshore wind farm, the world’s second largest.