July 26, 2018 / 12:36 PM / in 9 months

UPDATE 1-Italy's F2i to be Europe's No. 3 solar firm with Terra Firma portfolio buy

(Recasts, adds sources, details)

MILAN, July 26 (Reuters) - Infrastructure fund F2i is set to become Europe’s third largest solar power operator with the purchase of private equity firm Terra Firma’s Italian solar portfolio.

The companies did not give details on the price but two sources close to the matter said the 1.3 billion euro enterprise value included debt of around 700 million euros.

The deal, expected to close after summer, is Italy’s largest solar energy sale in a fragmented industry under pressure to consolidate after the end of generous state subsidies.

Since Terra Firma bought its RTR portfolio in 2011 the business has more than doubled its production capacity to 334 megawatts spread over 134 production sites.

“The noteworthy operating and financial efficiencies of scale achieved will also make (F2i) one of the continent’s most efficient operators,” CEO Renato Ravanelli said.

F2i, which is partly owned by state lender CDP, has a joint venture with Europe’s biggest utility Enel operating 395 MW of capacity in Italy.

F2i and Enel had originally placed a joint bid for the RTR portfolio but Enel pulled out.

“In recent weeks, F2i has expressed its intention to acquire the remaining 50 percent of the company currently held by Enel,” F2i said.

Enel was not available for immediate comment.

F2i was advised by Barclays, Intesa Sanpaolo and SocGen.

Terra Firma’s advisers included Cantor Fitzgerald, Jefferies, J.P. Morgan and UniCredit.

$1 = 0.8536 euros Reporting by Stephen Jewkes; editing by Agnieszka Flak and Jason Neely

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