TotalEnergies to buy 50% of EPH’s power assets for $5.9bn

TotalEnergies has accelerated its gas-to-power integration strategy by signing an statement to get 50% of EPH's flexible powerfulness procreation level successful Western Europe successful a €5.1bn ($5.92bn) all-stock transaction.

The woody includes assets successful Italy, the UK, the Republic of Ireland, the Netherlands, and France.

Under the deal, EPH volition beryllium paid wholly successful caller TotalEnergies shares, receiving 95.4 cardinal shares priced astatine €53.94 each. The issuance represents astir 4.1% of TotalEnergies’ stock capital.

The transaction volition found a associated task (JV), owned arsenic by TotalEnergies and EPH, to negociate the assets and thrust concern development.

Additionally, by leveraging TotalEnergies’ presumption successful supplying liquified earthy state (LNG) to Europe, the woody volition assistance diversify worth instauration crossed the state worth chain, peculiarly betwixt the US and Europe.

The transaction is expected to adhd nett energy accumulation of astir 15TWh per year, enabling TotalEnergies to seizure added worth equivalent to astir 2 cardinal tonnes per annum of LNG.

The portfolio comprises implicit 14GW gross capableness of operational oregon under-construction flexible procreation assets, including gas-fired powerfulness plants, biomass powerfulness plants, and artillery systems.

These assets payment from secured capableness revenues, which relationship for astir 40% of the gross margin.

The acquisition scope besides covers astir 5GW of projects nether development.

The JV is acceptable to go the preferred conveyance for TotalEnergies and EPH to thrust flexible powerfulness procreation maturation successful the targeted countries.

Over the adjacent 5 years, TotalEnergies anticipates an summation successful disposable currency travel of astir $750m per year, exceeding the further dividend associated with the recently issued shares.

The Integrated Power conception is expected to make affirmative escaped currency travel and lend to shareholder returns arsenic aboriginal arsenic 2027, compared to 2028 previously.

Due to this accelerated inorganic growth, TotalEnergies is lowering its yearly nett superior expenditure guidance by $1bn per twelvemonth to $14-$16bn per twelvemonth for 2026-2030, with $2bn to $3bn allocated to Integrated Power portion maintaining its 2030 energy procreation people of 100-120TWh.

TotalEnergies seat and CEO Patrick Pouyanné said: “This acquisition marks different large milestone successful TotalEnergies’ strategy to physique an integrated energy subordinate successful Europe.

"By joining forces with EPH arsenic portion of a semipermanent partnership, we are accelerating the implementation of our Integrated Power strategy and strengthening our quality to supply reliable, competitive, and low-carbon vigor to our customers by leveraging the complementarity of our renewable and flexgen portfolio.