Eni announced that it has signed an agreement to sell Snam a 49.9% stake in the companies that operate the two natural gas pipelines connecting Algeria to Italy, TTPC and TMPC
According to the agreement, Eni will contribute its entire ownership interest in the two pipelines to a new Italian company (NewCo), in which Eni will continue to hold a share of 50.1% while the remaining stake will be sold to Snam for EUR385 million.
On this occasion, Eni CEO Claudio Descalzi commented “This transaction allows us to free up new resources to be used on our energy transition path, while at the same time maintaining the management of a strategic infrastructure with Snam to ensure the security of natural gas supply to the country. Gas will play a key role in the transition of energy systems to zero-emission models, and it is important to maintain the availability and diversification of supply routes for this resource.”
Commenting on the agreement, Snam CEO Marco Alverà said “This deal consolidates Snam’s central role in Italy’s security of supply as well as in energy transport from the Mediterranean region. Through this transaction, Snam is bridging its infrastructure towards North Africa, which represents a key area for gas supplies to Italy and forward looking for hydrogen development. In the future, North Africa could also become a hub for producing solar energy and green hydrogen.”
The deal will also include a earn-in and earn-out mechanism, which will be calculated based on the revenues generated by the target companies
The statement elaborated that Eni and Snam will jointly control NewCo, based on equal governance principles. Through the equity method, both companies will therefore consolidate NewCo.