Zara founder Ortega raises bet on renewables with potential Repsol deal – sources

By Pietro Lombardi and Andres Gonzalez

MADRID/LONDON (Reuters) -Inditex founder Amancio Ortega’s investment firm Pontegadea is pushing further into renewable energy, closing in on a deal with Repsol (OTC:) to buy a 49% stake in its wind farms and photovoltaic power plants in Spain, two sources familiar with the deal told Reuters.

The Spanish fashion retail billionaire’s potential acquisition would expand Pontegadea’s investments in renewable energy. His family office has already bought minority stakes in energy assets, such as a 5% stake in Spanish gas grid operator Enagas’s renewable and hydrogen unit Enagas Renovable.

The Repsol renewable projects up for sale have a total capacity of about 600 megawatts and the transaction values them around 700 million euros ($747.18 million), sources said. The agreement may come as soon as next week, one of the sources said.

A Repsol spokesperson declined to comment.

“As usual, we do not have any comments on rumours about market operations while they are open,” a spokesperson for Pontegadea said.

While the production of renewable electricity depends on many factors, such as the location, the type of assets and the amount of sunshine and wind, the portfolio will generate electricity equivalent to the annual average consumption of more than 400,000 Spanish households, according to one estimate.

The deal is in line with Repsol’s strategy to fund its shift from oil and gas to renewables by selling minority stakes in renewable projects. Other companies, such as Spanish utility Iberdrola (OTC:), are following the same script, raising cash to invest in new projects by selling stakes in more advanced ones.

The Spanish oil company has sold stakes in other projects to Pontegadea. In 2021, Repsol sold Pontegadea a 49% stake in a separate wind farm for 245 million euros.

Pontegadea booked a net profit of 2 billion euros last year, up from 1.6 billion euros in 2021, mainly fuelled by dividends from Inditex (BME:). The firm holds a majority stake in Inditex and has diversified Ortega’s investments in sectors such as real estate and energy.

($1 = 0.9369 euros)