Azernews.Az

PARIS – GDF Suez SA, owner of Europe’s biggest natural gas network, sold its 5 percent stake in Gas Natural SDG SA for 540 million euros in cash.

Citigroup Inc. and Goldman Sachs Group Inc. were joint bookrunners, offering 46.2 million Gas Natural shares. The shares were sold at 11.70 euros apiece, according to a filing on the website of Spain’s securities regulator.

GDF Suez sold its stake after Spain’s largest natural gas company completed the purchase of utility Union Fenosa SA last year. Gas Natural plans to invest at a slower pace through 2012 as it tries to cut debt following the acquisition. GDF Suez agreed in August to buy International Power Plc, creating a producer worth $30 billion with plants from Brazil to Australia.

The Gas Natural stake sale "is part of the optimization strategy of the group financial resources," Paris-based GDF said today in a statement.

Gas Natural fell 4 percent to close at 11.65 euros in Madrid, its biggest drop since June 29. That gives the Barcelona-based company a market value of 10.7 billion euros.

GDF Suez in August 2009 said it wouldn’t buy a stake in Gas Natural being sold by its 34.5 percent-owned water and waste company, Suez Environnement. At the time, Chief Executive Officer Gerard Mestrallet said the company hadn’t decided what to do with its own holding of more than 11 percent. The stake was acquired by Suez SA in 2007 before the merger the following year with former French monopoly holder Gaz de France SA.

Suez Target
Gas Natural was considered a target of Suez for Spanish expansion amid a prolonged period of uncertainty about whether the merger with GDF would go ahead.

Gas Natural’s average annual gross investment will fall to 1.8 billion euros a year from 2010 through 2012 from about 2.1 billion euros last year as the company spends on its distribution and generation units. Spanish gas demand has climbed this year after dropping 11 percent in 2009.

The Spanish company has also sold assets following the Fenosa purchase. Gas Natural aims to sell about 1.5 billion euros of assets from 2010 through 2012. Earlier this year, Gas Natural sold a 5 percent stake in Indra Sistemas SA, a Spanish computer-services company. In 2009 it agreed to sell stakes in its generation units in Mexico and a holding in Empresa de Energia del Pacifico SA of Colombia.

Gas Natural had electricity generation capacity of 15,598 megawatts in Spain and abroad at the end of June. So-called combined-cycle power plants accounted for 59 percent, hydropower 12 percent and coal-fired plants 13 percent of capacity.

Suez Environnement, which is partly owned by GDF Suez, in October 2009 said it sold most of its stake in Gas Natural. Oil producer Repsol YPF SA owns 31 percent of Gas Natural, while holding company Criteria CaixaCorp SA has 37 percent.