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Snam acquires stake in OLT

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LNG Industry,

Snam and the Iren Group have signed an agreement related to Snam’s acquisition of a 49.07% stake in the share capital of Offshore LNG Toscana (OLT).

OLT built and manages the offshore floating storage and regasification unit (FSRU) terminal located approximately 22 km off the Tuscan coast between Livorno and Pisa.

The agreement provides for an assessment of approximately €400 million for the quota, as of 31 December 2017, which also includes a shareholder loan granted by Iren in favour of OLT. This assessment is subject to upward and downward price adjustments, agreed between the parties, also in relation to the reimbursements of the aforementioned loan carried out by OLT after 31 December 2017. The net amount at the closing of the transaction – reflecting a different timing compared to the previous transaction between Uniper and First State Investments – will amount to approximately €345 million (including the interest provided for by the agreement from the reference date of the valuation and excluding any increase adjustments). The consideration will be paid by Snam with its own funds.

The closing of the transaction is subject to prior approval by the competent authorities (Antitrust authorisation and ‘Golden Power’ authorisation). After the acquisition is completed, OLT will be jointly controlled by Snam and First State Investments, and the shareholding will be composed as follows: Snam 49.07%, First State Investments 48.24% and Golar LNG 2.69%.

Snam CEO Marco Alverà said: “Snam’s entrance into OLT will guarantee industrial expertise in management and in future investments into vital infrastructure for the Italian energy system’s security and flexibility and will consolidate our position in the Mediterranean LNG market.

This acquisition is in line with our growth strategy in infrastructure for liquefied natural gas, a sector that is fundamental to enabling energy transition and promoting sustainable mobility, as global demand is destined to double between now and 2035, reaching 600 million tpy. Between September 2018 and August 2019 alone, Italian LNG demand grew by 70% and global demand by 15%.”

Iren Chairman Renato Boero and CEO Massimiliano Bianco jointly stated: “The sale of OLT successfully completes the path to exploiting our participation in OLT and the FRSU Toscana plant managed by the company, in a context of full use confirmed also for the 2019/2020 thermal year. The proceeds from the sale of OLT will significantly enhance our financial structure and enable the Iren Group to boost investments in development activities (both organic and external) set out in our industrial plan, in line with our business model deeply rooted in the territories.”

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