F2i and AXA buy Italian gas network for €772m

A consortium of French investor AXA Private Equity (AXA PE) and Italian infrastructure fund F2i have announced their third acquisition in the Italian gas distribution sector: the purchase of GDF Suez’s Italian gas network for an enterprise value of €772 million.

The network, known as G6 Rete Gas, runs over 15,000 kilometres and serves some 990,000 clients throughout Italy. The purchase price amounts to 1.03 times the asset’s 2010 regulated asset base, 9.3 times its earnings before interest, tax, depreciation and amortisation (EBITDA), and 17.5 times its net income, AXA PE and F2i said in a statement. 

Italian banks Banca IMI and Unicredit have committed to provide debt for the deal, which is expected to close during the fourth quarter of the year. Once the deal closes, the consortium – in which F2i owns 75 percent and AXA PE holds 25 percent – will be Italy’s largest independent gas distribution operator, with a market share of 17 percent, both partners said. The AXA PE/F2i consortium will be second only to Italian utility Eni, the partners added.

AXA PE and F2i acquired Enel Rete Gas from Italian utility Enel in September 2009 and, more recently, the Italian gas network of German utility E.On, in April of this year.

Separately, both partners have also been active this year on the acquisitions trail. F2i purchased Italian fibre optic firm Metroweb for an enterprise value of €436 million earlier this month from private equity firm Sterling Capital Partners and Italian utility A2A.

In February, AXA PE acquired a 10 percent stake in Spanish oil storage and transportation firm Compania Logistica de Hidrocarburos, the first seed investment of its third infrastructure fund. 

As reported yesterday on Infrastructure Investor, AXA PE is due to hold an interim close this week for its third infrastructure vehicle that should take the amount of capital raised for it to €650 million. The fund is targeting a final close of around €1 billion, which may take place as early as this summer, one source said. The source added that AXA PE’s third fund does not have an official hard cap, but that the fund manager will not seek to raise more than €1.5 billion for the fund.

AXA PE has two prior infrastructure funds. The first was a €200 million vehicle formed specifically so that it could acquire a stake in SANEF, the French motorway operator. Its second fund closed on €1.1 billion. Like its two predecessors, Fund III is also expected to focus on investments across France, Italy, Germany and the UK.