TotalEnergies is buying out Total Eren’s other shareholders, increasing its stake from close to 30% to 100%.
The Total Eren teams will be fully integrated within TotalEnergies’ Renewables business unit.
The deal follows the strategic agreement signed between TotalEnergies and Total Eren in 2017, which granted TotalEnergies the right to acquire all of Total Eren (formerly EREN RE) after a five-year period.
As part of this transaction, Total Eren is valued at an Enterprise Value of €3.8bn based on an attractive EBITDA multiple negotiated in the initial strategic agreement signed in 2017.
The acquisition of 70.8% represents a net investment of around €1.5bn for TotalEnergies.
Total Eren’s integration should result in an increase in TotalEnergies’ Integrated Power Net Operating Income of around €160m and CFFO of around €400m in 2024.
Total Eren has 3.5GW of renewable capacity in operation worldwide and a solar, wind, hydroelectric and storage projects pipeline of over 10GW in 30 countries, of which 1.2GW are in construction or late-stage development.
TotalEnergies will leverage Total Eren’s 2GW assets in operation in merchant countries (notably Portugal, Greece, Australia, and Brazil) to build up its integrated power strategy.
TotalEnergies will also benefit from Total Eren’s footprint and ability to develop projects in other countries such as India, Argentina, Kazakhstan, or Uzbekistan.
Total Eren will not only contribute high-quality operated assets, but also the expertise and skills of nearly 500 people based in more than 20 countries.
Further to its activities as a renewable energy producer, Total Eren has launched pioneering green hydrogen projects in recent years, located in various regions, such as North Africa, Latin America, and Australia.
These green hydrogen activities will be pursued through a new partnership in an entity named TEH2 (80% owned by TotalEnergies and 20% owned by EREN Group).
Chairman and chief executive Patrick Pouyanné said: “Our partnership with Total Eren has been very successful, as shown by the size and quality of the renewables portfolio.
“With the acquisition and integration of Total Eren. we are now opening a new chapter of our development as the expertise of its team and its complementary geographical footprint will strengthen our renewable activities and our ability to build a profitable integrated power player.
“I want to thank Total Eren’s founders, Pâris Mouratoglou and David Corchia, as well as their teams, for their incredible development work, which led to this successful achievement.
“Today, we are welcoming Total Eren’s experienced teams, who will continue their remarkable work with the added resources of a bigger company.”