Portugal’s largest utility EDP said it agreed to buy Spanish electricity company Viesgo from Macquarie funds in a deal worth 2 billion euros ($2.28 billion) including debt.
In a statement, EDP said it would buy Viesgo for a net equity investment of 900 million euros, and the deal, which will more than double EDP’s presence in electricity distribution in Spain, would be financed through a rights issue worth just over 1 billion euros.
Although global M&A activity tumbled to its lowest level in more than a decade in the second quarter as many firms gave up on expansion plans in the wake of the coronavirus outbreak, the slump has been somewhat lighter in Europe and some dealmakers have seen a gradual pick-up as companies adapt to a post-coronavirus reality.
The Viesgo deal is expected to be sealed by the end of the year.
“Viesgo’s transaction … represents a unique investment opportunity for EDP, price value at 2.7 billion euros, which will result in EDP consolidating Viesgo’s existing net financial debt of 1.1 billion euros.