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14/03/2011
QATAR HOLDING TO BECOME STRATEGIC PARTNER OF IBERDROLA AND ONE OF ITS MAJOR SHAREHOLDERS

  • Both parties have signed a Strategic Memorandum of Understanding to collaborate on developing respective business activities
  • The Board of Directors of IBERDROLA, S.A. has approved a capital increase of 6.17% and a sale of treasury shares representing 0.37% of the share capital pre-increase
  • Qatar Holding LLC through its wholly-owned subsidiary has invested €2,021 million to acquire all such new and treasury shares for a total shareholding of 6.16% post-increase

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Qatar Holding LLC and IBERDROLA, S.A. are pleased to announce today that they have signed a Strategic Memorandum of Understanding setting forth the framework for collaboration in developing their respective business activities through the establishment of a long-term, mutually beneficial, strategic partnership.

The two parties will cooperate for the purpose of developing new business opportunities in different areas of the global electricity value chain with a focus on high-growth and emerging markets. IBERDROLA also intends to establish its regional Headquarters as well as research and development operations in the State of Qatar.

Additionally, Qatar Holding through its wholly-owned subsidiary has fully subscribed to the 6.17% capital increase approved by the Board of Directors of IBERDROLA for a total investment amount of €1,906 million. The issue price is €5.633 per IBERDROLA share.  Further, Qatar Holding through its wholly-owned subsidiary has agreed to acquire treasury shares representing 0.37% of the share capital of IBERDROLA pre-increase, at the same price per share for a total purchase amount of €115 million. Consequently, Qatar Holding through its subsidiary will hold 6.16% of the share capital of IBERDROLA outstanding after the capital increase. The cash inflow from the capital increase will allow IBERDROLA to strengthen its financial position and pursue corporate transactions such as its proposed merger with IBERDROLA RENOVABLES, S.A., the acquisition of Elektro Electricidade e Servicios, S.A. in Brazil, and other growth opportunities. 

Commenting on the transaction, Mr. Ahmad Mohamed Al-Sayed, Managing Director and Chief Executive Officer of Qatar Holding, said: “We are pleased to announce this strategic transaction with IBERDROLA and look forward to a long-term partnership as outlined in our Memorandum of Understanding.  In addition to a strong, stable European franchise, our investment in IBERDROLA provides significant exposure to other important global markets including Brazil, Mexico and the United States of America. As such, this investment represents a further step in our strategy of building a diversified portfolio of leading global enterprises.”

Ignacio S. Galán, Chairman and CEO of IBERDROLA, said: “I welcome Qatar Holding as a new major shareholder and strategic partner of IBERDROLA. Through this investment, Qatar Holding recognizes the success of IBERDROLA’s strategy. The Strategic Memorandum of Understanding represents the first step of a long-term relationship that will support each other’s future development”.

 

IMPORTANT INFORMATION

This communication does not constitute an offer to purchase, sell or exchange or the solicitation of an offer to purchase, sell or exchange any securities. The shares of IBERDROLA, S.A. may not be offered or sold in the United States of America except pursuant to an effective registration statement under the Securities Act or pursuant to a valid exemption from registration.

This communication contains forward-looking information and statements about IBERDROLA, S.A., including financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future operations, capital expenditures, synergies, products and services, and statements regarding future performance. Forward-looking statements are statements that are not historical facts and are generally identified by the words “expects,” “anticipates,” “believes,” “intends,” “estimates” and similar expressions.

Although IBERDROLA, S.A. believes that the expectations reflected in such forward-looking statements are reasonable, investors and holders of IBERDROLA, S.A. shares are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of IBERDROLA, S.A., that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include those discussed or identified in the public documents sent by IBERDROLA, S.A. to the Comisión Nacional del Mercado de Valores.

Forward-looking statements are not guarantees of future performance. They have not been reviewed by the auditors of IBERDROLA, S.A. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date they were made. All subsequent oral or written forward-looking statements attributable to IBERDROLA, S.A. or any of its members, directors, officers, employees or any persons acting on its behalf are expressly qualified in their entirety by the cautionary statement above. All forward-looking statements included herein are based on information available to IBERDROLA, S.A. on the date hereof. Except as required by applicable law, IBERDROLA, S.A. does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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