Sep 8 2021

The CNMV authorises IFM GIF's public partial voluntary offer for up to 22.69% of Naturgy


Madrid, 8 September, 2021

  • IFM Investors (IFM) is pleased to have received the partial offer authorisation from the CNMV.
  • IFM believes that the transaction represents an attractive financial proposition: Naturgy’s shareholders who wish to accept the partial Offer with their shares may do so for EUR 22.07 per share. The price was a premium of 19.7% on the trading price of the Naturgy shares at the closing of the trading session on 25 January 2021, the date immediately prior to the date of publication of the offer prior announcement.
  • The partial offer price, which will be fully paid in cash, is above the high-end of the valuation range concluded by an independent expert, which has prepared a valuation report of Naturgy in accordance with the provisions of Article 137.2 of the recast text of the Securities Market Law (LMV).
  • Jaime Siles, Vice President at IFM Investors: “We look forward to being a constructive partner at Naturgy, bringing stability and support to its management plans.”

IFM Investors, the Australian pension fund owned manager, has today received authorisation from the CNMV for the partial voluntary public takeover offer made by IFM Global Infrastructure Fund’s ("IFM GIF") for a maximum of 220,000,000 shares of Naturgy Energy Group, S.A. ("Naturgy"), representing 22.69% of its share capital. In the event that the number of shares accepting the offer exceeds this maximum of 220,000,000 shares, the relevant distribution and prorating rules will apply.

The partial offer acceptance period will commence shortly. During this period, Naturgy’s shareholders may accept the Offer with their shares for EUR 22.07 per share, all in cash.

The partial offer was announced on 26 January 2021 at a price that represented a premium of approximately:

  • 28.9% on the volume weighted average trading price of the Naturgy shares during the six months immediately prior to the publication of the offer prior announcement (EUR 17.84); (from 25 July 2020 to 25 January 2021);
  • 19.7% on the trading price of the Naturgy shares at the closing of the trading session on 25 January 2021, the date immediately prior to the date of publication of the offer prior announcement (EUR 19.22).

Therefore, IFM believes that the Offer represents an attractive financial proposition for Naturgy’s shareholders particularly given that the average share price performance of Naturgy’s closest peers has declined by -9.5%1 since the announcement of the Offer.

The partial offer price meets the provisions of Article 137.2 LMV, to the extent that it will be paid in cash, and it is justified by a valuation report of an independent expert in accordance with the valuation criteria set forth in such article. Therefore, IFM believes that the offer represents an attractive financial proposition for Naturgy’s shareholders.

IFM Investors was established more than 25 years ago by a group of Australian pension funds, and was founded to protect and grow the retirement savings of working people. IFM manages money on behalf of pension funds and other like-minded institutional investors, who represent more than 30 million pension fund members globally.

Highlights

The key terms of the partial offer are:

  • The consideration of the partial offer is EUR 22.07 per Naturgy share and will be fully paid in cash.
  • The partial offer is targeting a maximum of 220 million shares of Naturgy. Therefore, the maximum total amount to be paid by the Offeror is EUR 4,855,400,000. In the event that the shares accepting the offer exceeds the maximum number of 220,000,000 shares for which the offer is made, the distribution and prorating rules set out in Article 38.1 of Royal Decree 1066/2007 and described in section 2.1.2 of the prospectus will be applicable.
  • The initial consideration of the partial offer amounted to EUR 23.00 for each share of Naturgy. However, this price was adjusted as a consequence of the dividend payments made by Naturgy to its shareholders since the announcement of the offer:
    • Adjustment equivalent to the gross amount of the dividend of EUR 0.63 for each Naturgy share that was paid on 17 March 2021
    • Adjustment equivalent to the gross amount of the dividend of EUR 0.30 for each Naturgy share that was paid on 4 August 2021
  • The initial consideration under the partial offer represents a premium of 28.9% over the volume weighted average trading price of Naturgy shares during the six-month period immediately prior to the announcement of the offer, and 19.7% on the trading price of the Naturgy shares at the closing of the trading session on 25 January 2021, the date immediately prior to the date of publication of the Offer prior announcement.
  • Since the announcement of the Offer on 26 January 2021 until 7 September 2021, the share prices of Naturgy’s closest peers have traded down by -9.5%1 on average.
  • The effectiveness of the partial offer is subject to its acceptance by at least 164,834,347 Naturgy shares, representing 17% of Naturgy’s share capital.
  • Prior to the authorisation of the partial offer by the CNMV, the offeror obtained on 3 August 2021 the authorisation from the Spanish Council of Ministers for the direct foreign investment in Spain, as provided for in Article 7 bis of Law 19/2003, of 4 July, on the legal regime governing capital movements and economic transactions abroad.
  • The authorisation by the Spanish Council of Ministers includes certain conditions which are reflected in section 5.2.1 of Chapter V of the Prospectus and which the offeror has decided to accept.
    • In the use of its voting rights the offeror will support (following conditions will apply for five years): keeping the registered address and centre of effective management and administration of the businesses in Spain; maintaining a significant share of the group’s workforce in Spain; a prudent dividend policy that enables the investment policy relating to investments in the energy transition; a policy of external borrowing aimed at (i) keeping the investment grade credit rating for the company and (ii) allowing that the indebtedness ratios of its regulated subsidiaries in Spain do not exceed those recommended by the Spanish Competition and Markets Authority (CNMC); market disclosures of annual and half-yearly financial information, which are provided to investors in an easily accessible manner, and preparation and disclosure of the annual corporate governance report and annual report on board remuneration; and generally supports the company’s investment in projects linked to the energy transition in Spain.
    • The offeror will not support in the use of its voting rights (following conditions will apply for five years): any proposals for divestiture (other than pursuant to the company’s existing 2021-2025 Strategic Plan) that are made to the company’s board or to shareholders whereby the company loses control of subsidiaries that jeopardise the proper operation of power and natural gas distribution and transportation activities in Spain; and (will apply during three years) will not support any proposals for the delisting of the company shares from the Spanish stock exchanges, unless the free float, trading frequency or trading volume are not sufficient for a correct pricing of the shares price on the stock exchanges.

Jaime Siles, Vice President at IFM Investors, said today: "We welcome the authorisation from the CNMV and we believe this is an excellent opportunity for shareholders to obtain an attractive all-cash price for their shares, subject to proration. We look forward to being a constructive partner at Naturgy, bringing stability and support to its management plans.”

Jaime Siles added: "When we invest, we invest for the long-term, with a focus on meeting the expectations of the community, which means we value workers’ rights and respect the environment. As one of the largest infrastructure managers in the world, we see Naturgy as a company that is firmly aligned with our core investment principles and objectives.”




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About IFM Investors

IFM Investors was established more than 25 years ago with the aim to protect and grow the long-term retirement savings of working people. Owned by a group of Australian pension funds, the organisation has AU$172bn under management as of 30 June 2021. Because IFM is owned by industry pension funds, we prioritise the interests of more than 550 like-minded investors worldwide by focusing on assets that combine excellent long-term risk/reward characteristics with broad economic and social benefits to the community. As a signatory to The United Nations-supported Principles for Responsible Investment, IFM actively engages on ESG issues with the companies in which it invests with the aim of enhancing their net performance while minimising investment risk.

Operating globally from offices in Melbourne, Sydney, London, Berlin, Zurich, Amsterdam, New York, Hong Kong, Seoul and Tokyo, IFM manages investments across infrastructure, debt, listed equities and private equity assets. For more information, visit www.ifminvestors.com

To obtain the full information on the public Offer, please refer to the Prospectus authorised by the CNMV and its ancillary documentation, which will be available to the public in electronic format at least from the day following the publication of the first announcement described in Article 22.1 of Royal Decree 1066/2007 at the websites of CNMV (www.cnmv.es), of IFM (www.ifmofertaacciones.com) and Naturgy (www.naturgy.com).




1 Average share price performance from 26 January 2021 until 7 September 2021 of Iberdrola (-11.2%), Endesa (-7.0%), EDP (-11.9%) and Engie (8.1%). Source: Bloomberg

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