The Snam Board of Directors, which met yesterday under the chairmanship of Carlo Malacarne, approved the separation of Italgas to Snam be executed through a single transaction and the context which includes, among other things , the partial and proportional demerger and subsequent listing on the Electronic Stock market (MTA) of Milan for a new beneficiary company of the spin-off with the role of holding the stake in Italgas. “In a constantly changing market, the city gas distribution is now an activity with characteristics and needs other than those of transport, storage and LNG. The separation from Snam Italgas will significantly enhance the role of both companies in their business: Snam will consolidate its leadership by helping to further integrate the gas markets in Europe and Italgas will seize the best opportunities for development related to new calls for tenders, “said CEO Snam, Marco Alvera. Through the operation of industrial and corporate reorganization, the entire stake currently held by Snam Italgas, equal to 100% of Italgas share capital, will be transferred to the recipient company in order to separate the distribution of gas in Italy – It has its own specificity with respect to the other activities of the Group in terms of operational organization, competitive environment, regulation and investment needs – those of transport and dispatching, LNG and storage activities in Italy and abroad. The operation, unitary and substantially contextual, as a whole is split:? the contribution in kind by Snam to the company receiving a stake of 8.23% of the share capital of Italgas to Snam against the assignment of n. 108,957,843 newly issued shares of the recipient company in order to allow Snam to hold, after the split, a stake of 13.50% in the aforementioned company; ? the sale by Snam to the company receiving the n. 98,054,833 Italgas shares, representing 38.87% of Italgas share capital, for a price of € 1,503 million, the payment of which will be the subject of a vendor loan from the recipient companies, so as to generate an appropriate level of financial debt, taking into account the business profile, risk and generation of cash flow; ? the partial and proportional demerger of Snam assignment with the company receiving a stake of 52,90% held by Snam Italgas with consequent allocation to the shareholders of Snam of the remaining 86.50% of the capital of the recipient company. Following these operations, Snam will hold a stake of 13.50% of the capital of the recipient company. As a result of the demerger, the shareholders of Snam will be allocated shares of the beneficiary company in proportion to those already held in Snam to the effective date of the demerger. The allotment will be an action of the recipient company Snam every five shares held. This exchange ratio of the shares may determine for individuals shareholders the right to the award of a number of new shares is not full. In order to facilitate the operations of quadrature Snam instruct an intermediary to perform the trading activity of the fractions of the beneficiary company’s shares, by means of all depository intermediaries participating in Monte Titoli SpA, to the extent necessary to enable the shareholders to hold a whole number of shares. The beneficiary company will be listed separately on the MTA (MTA) in Milan and will operate separately as an independent company with its own management and Board of Directors. The effectiveness of the operation is therefore dependent, in addition to the conditions of the law including in particular the Assembly’s vote in favor of the shareholders of Snam: – the issue of the Italian stock exchange admission decision of the beneficiary company’s shares to trading on the MTA, – the release of the part of CONSOB of equivalence, and – approval of Snam bondholders. The operation schedule provides that, to the realization of these conditions, the split will take effect, presumably, by 31 December 2016. For the spin-off, the net assets of Snam will be proportionally reduced by the amount of 1,569,211,964.76 euros1, by allocation of the amount to 961,181,518.44 Euros as a reduction of the share capital and € 608,030,446.32 deducted from reserves. Given that the shares of Snam are no indication of nominal value, the aforementioned reduction of the share capital does not give rise to any cancellation of shares. Conversely, the net assets of the beneficiary company will increase by EUR 1,569,211,964.76, through allocation to share capital of EUR 961,181,518.44, which therefore will increase from 40.05 million euro to 1,001,231,518.44 Euros, with ‘ the issue of no. 700,127,659 new shares, with regular dividend, and reserves totaling EUR 608,030,446.32. From the split will not be born of withdrawal rights of shareholders, in consideration of the listing of the beneficiary company’s actions within the effective date of the demerger. As envisaged in the memorandum of understanding concluded between Snam, CDP and CDP Gas Networks, the operation as a whole also requires that Snam, CDP CDP Gas Networks and sign a shareholders’ agreement covering the investments held in the beneficiary company, accounting the 13,50% to 25,08% and 0.97%, in order to ensure a stable and transparent ownership structure of the recipient company of the operation. In particular, the memorandum is aimed at regulating the main terms for the realization of the operation and general governance rules, then apply to the receiving company and Italgas. The operation and the Memorandum of Understanding were referred to the Control and Risk Committee and Related Party Transactions of Snam in the procedure for governing transactions with related parties adopted by Snam November 30, 2010 in accordance with CONSOB Regulation . On 28 June 2016, the Control and Risk Committee and Related Party Transactions of Snam issued its reasoned opinion unanimously favorable about the interest of Snam to proceed with the transaction and the convenience and substantial correctness of the relative conditions. The demerger plan, the explanatory report and the relevant information will be published, pursuant to the terms of applicable laws and regulations, on the company’s website (www.snam.it) and deposited and made available in the legislative timeframe applicable at the storage mechanism authorized named “NIS-storage” run by Bit Market Services SpA (Www.emarketstorage.com), as well as at the registered office of Snam in Piazza Santa Barbara 7, San Donato Milanese (MI). The content of the document to be published before the shareholders’ meeting that will approve the spin-off complies with the content within the scheme n. 2 Annex 3B of the Issuers’ Regulation and Annex 4 of the CONSOB Regulation adopted with resolution no. 17221 of 12 March 2010. The Board of Directors has called for on 1 August 2016 the extraordinary and ordinary shareholders’ meeting to approve the transaction, respectively, and the change in share capital resulting from the splitting and to ask the authorization to buy of treasury shares up to a maximum of shares not exceeding 3.5% of the share capital of Snam. Please note that the treasury shares already held at the date of this release totaled 1,127,250, representing 0.03% of the share capital of Snam. The authorization for the purchase of treasury shares is requested for a period of 18 months from the effective date of the partial and proportional demerger of the company, subject to approval by the extraordinary shareholders’ meeting convened on August 1, 2016. The Explanatory report of the Board of Directors Shareholders’ Meeting, under art. 73 of the Issuers Regulation, will indicate the criteria for determining the purchase price of the treasury shares. The purchases will be made in accordance with the provisions in Article 132 of the TUF, art. 144-bis of the Issuers’ Regulations and other applicable legislation, including, where applicable, the market practices recognized by Consob. It is also specified that the purchases will be implemented by the Board of Directors or the entities commissioned by it in compliance with the provisions of Article 2357, first paragraph, of the Civil Code, namely in the distributable income regularly assessed and the available reserves recently approved financial statements. Notice of Ordinary and Extraordinary Shareholders meeting of the company and the Explanatory Report of the Board of Directors Shareholders’ Meeting, under art. 73 of the Issuers Regulation, will be made available to the public with the timelines provided by law. The Board of Directors also resolved to convene a meeting of Bondholders to request authorization the transaction giving mandate to the CEO to fix the day. The Board of Directors also confirmed Georgeson as the entity designated by the Company pursuant to art. 135-j of the CFA when shareholders and bondholders can confer, with no burden on them, the delegation for participation in the meeting. Goldman Sachs has acted as financial advisor in the transaction; Cleary Gottlieb Steen & amp; Hamilton and Orrick, Herrington & amp; Sutcliffe acted as legal advisor.
(RV)
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