The Board of Directors of IBERDROLA, at its meeting held today in Bilbao, approved the implementation of a four for one share split, reducing the nominal value of each share from 3 euros to 0.75 euros. The share split was first approved at the Annual General Shareholders Meeting last March 29.

With this split, which IBERDROLA previously announced would be implemented once the acquisition of Scottish Power was completed, is in line with the increasing market capitalisation of the Company over the last years. The number of outstanding shares will be multiplied by four, from 1,248,435,510 to 4,993,742,040, although the share capital amount will remain at 3,745,306,530 euros.

Following the agreement adopted at today´s regular board meeting, and once the appropriate administrative steps are completed, the new shares are expected to start trading next Monday October 8th. The transaction will not imply any cost for shareholders.

The objective of the share split, common practice among the major IBEX-35 companies in past years, is fundamentally to offer gtreater liquidity and trading opportunities, as well as facilitate fidelity programmes for investors (such as the Dividend Reinvestment Programme, started by the Company in 2006).

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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.