Purchase of 13.7% of REN by the State receives a visa from the Court of Auditors

“ O the case in question was targeted at the Visa Daily Session of 31 August and notified to the entity on 1 September”, said official source of the body in written reply.

The Court of Auditors' visa was the condition that was lacking to conclude the deal agreed on August 14 between Parpublica, manager of the State's holdings, and Pontegadea Inversiones, investment company of Amancio Ortega, founder of Indix, owner of Zara.

The transaction was carried out outside the market, through the transfer to Parpublica – of 91,723,676 shares of REN – National Energy Networks, corresponding to 13.7% of the share capital, according to information communicated to the market.

The completion of the operation was also communicated on Monday by the electricity and gas network manager in Portugal to the Securities Market Commission (CMVM) based on information sent by Pontegadea Inversiones.

Amancio Ortega’s company indicated that it transferred the shares to Parpublica “following the verification of the suspensive condition provided for in the contract of purchase and sale concluded with Parpublica on 14 August”.

With the completion of the operation, Pontegadea stopped holding any participation in REN.

The value of the transaction was not disclosed in the market communication, but the Economic Journal advanced in August that the business would amount to EUR 380 million, which would imply a premium of around 17% compared to the market value on the day of the announcement.

Questioned on 20 August on this amount and on the premium associated with the operation, the Government did not confirm the final amount, referring the details to the Ministry of Finance, but justified the payment of a premium for the weight of the participation and the influence it confers.

In the briefing of the Council of Ministers, the Minister of the Presidency, António Leitão Amaro, explained that acquisitions of relevant holdings in listed companies are usually made through bilateral negotiations, with reference to the history of the quotation, plus a premium agreed between the parties.

“ Typically, they are made by the listing history plus an X prize that is then agreed between the parties”, he said.

The Minister also justified the option of a negotiated acquisition, rather than a gradual stock purchase, with the reduced liquidity of REN shares and the impact that an operation of this size could have on the quotation.

The position of 13.7% acquired by the State becomes the second largest in REN's capital, behind the 25% held by the Chinese State Grid.

The government justified the entry into REN’s capital with reasons for “sovereignty and energy security”. Leitão Amaro pointed out, however, that the shareholder function does not replace the other public functions in the energy sector, but complements them, referring to the position of the State as a network granter and the regulatory function exercised by an independent regulator (ERSE).

The operation represents the return of the Portuguese State to the capital of REN, after the departure of the last state participation in the company, in 2014.