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Italy's Enel renews deal with Cinven in Latam fiber grid Ufinet

By Reuters

<div> <p><span class="caps">MILAN</span> -Italian utility Enel will remain a minority investor in Latin America’s Ufinet by renewing a partnership with private equity firm Cinven that will give it 19.5% of the broadband group.</p> <p>Europe’s biggest utility, which currently owns 21% of Ufinet, had an option to buy out Cinven which it could exercise before the end of the year.</p> <p>In a statement on Tuesday, Enel said it had agreed to buy out Cinven but would immediately sell 80.5% back to another fund managed by the private equity firm in order to renew the partnership.</p> <p>Under the agreement, Enel X International will keep board representation in Ufinet, with a right to sell its stake under the same conditions as Cinven should the private equity firm opt to sell.</p> <p>The deal, set to close in the first quarter of next year, is expected to generate net cash for Enel of around 60 million euros ($68 million) with a positive impact on operating results of about 200 million euros.</p> <p>Ufinet, headquartered in Spain, manages some 80,000 km (50,000 miles) of optical fibre in 17 countries in Central and Latin America. Last year it had revenues of around $250 million.</p> <p>Broadband networks are attracting interest from investors as customers use ever more data and TV services via mobile and home devices, a trend that accelerated during the coronavirus lockdowns.</p> <p>Enel, which controls Spanish utility Endesa, has extensive energy operations in Latin America and has launched a financial services business in Colombia.</p> <p>($1 = 0.8875 euros)</p> </div>