Renta 4 |According to press reports, Iberdrola’s US subsidiary Avangrid is preparing a plan via which the group is looking at divesting in some renewable assets (total or partial) to strengthen the balance sheet ahead of its investment plan over the next few years. This amounts to 14.6 billion usd until 2025, including the purchase of PNM (6.5 billion usd) if the courts allow that to materialise.
The divestments could be around 2 billion euros, while some capital hike for a similar amount is not ruled out if the PNM buy goes ahead.
Valuation: The news is not surprising. It is something Iberdrola has been doing over the last few quarters with partial divestments of renewable assets. This is allowing it strengthen its balance sheet ahead of the big investments it is making, both in networks and in renewables. We will see during the Capital Markets Day on November 9 what kind of details Iberdrola provides in this regard. News without any relevant impact.
Recommendation: Overweight. Target Price 12,73 euros/share.
