TheChek News Flow

Acciona has reached an agreement with Nordex to sell its wind turbine

manufacturing subsidiary for €785mn. According to the press release,

Acciona will receive: i) 16.1mn new issued shares of Nordex (16.6% of

Nordex) valued at €26/sh and ii) a cash payment of €366.4mn. Additionally,

Acciona has reached an agreement with Momentum-Capital to buy an

extra 13.3% stake in Nordex for €335.4mn (implying a value of €26/sh).

Acciona will host a conference call at 08:30 (London time).

We see this as a potential positive for Acciona (last close €63.22) as it

would crystallise the value of its wind turbine manufacturing business and

provide evidence of momentum in the restructuring of the conglomerate.

The transaction implies a multiple of 8.7x EV/EBITDA ‘15E, and is slightly

above our valuation for Acciona wind power of €756mn. Acciona wind

power represented 4% of group EBITDA in 2014 and we forecast 8% in ‘15.

At the same time Acciona acquires a 29.9% stake in Nordex at a per share

value of €26, a 19% discount to our 12m PT (based on DCF, EV/EBITDA with

M&A weighting) of €32/sh (PT risks include lower-than-expected volumes

(mainly in Europe, particularly Germany)). We estimate the value creation

for Acciona from the acquisition of the stake would be c. 3% of our SOTP

(€89/sh) based on our Nordex PT. We view this transaction as an

acceleration of Nordex’s (last close €24.96) strategy to diversify further

into EM and the Americas. We estimate Acciona’s EBITDA represents c.

50% of Nordex’s, on our ‘15 forecasts, excluding synergies which are

expected to be very material (Acciona estimates €95mn, c. 35% of the

combined EBITDA in ‘15E). We estimate moderate growth for the Americas

with significant divergence between countries.

Our price targets and ratings are unchanged.

We see positive read across for Gamesa and Vestas from the deal as the

transaction implies a multiple of 8.7x EV/EBITDA vs. Vestas at 7.8x,

(Gamesa is in line). The synergy potential from the combination could be

significant relative to the size of the business.