Jointly towards a long term sustainable energy supply

Transcription

1 Jointly towards a long term sustainable energy supply Lars G. Josefsson, CEO Vattenfall, CEO Nuon 23 February 2009

2 Agenda Nuon & Vattenfall: a great partnership Rationale for Nuon Rationale for Vattenfall Key terms Benefits for stakeholders Lars G. Josefsson Lars G. Josefsson 1

3 We are off to a great partnership Our new company Leading European energy company with a stable shareholder Safeguarding of Dutch identity and public interests Well positioned to grow further in renewable energy; already #1 in off-shore wind Strong focus on security of supply through a diversified fuel sourcing strategy Continued focus on attractive and competitive products for our customers Exciting opportunities for employees in a successful international company Strong cultural fit, providing basis for successful integration 2

4 Transaction highlights Valuation Total Nuon equity value has been set at 10.3 billion Enterprise value of 8.5 billion Transaction aspects Vattenfall will buy 49% of Nuon shares as of closing Remaining shares will be bought over a period of 6 years Strategy A detailed strategy has been agreed for the Benelux, fully in line with initial Nuon strategy Public assurances Interests of Nuon, its customers, employees, and Dutch society will be further safeguarded through Nuon Energy Public Assurance Foundation 3

5 We will be a leading player in the European energy market A strong footprint across Europe and a leading position in European market Our new company Wind capacity # 1 in off-shore wind 529 MW On-shore 371 MW Off-shore Biomass capacity # MW Heat production # TWh Sweden Finland Trading Top 3 Presence in major trading hubs and commodities Electricity production # TWh Electricity supply # million customers UK NL BE DK Germany Poland Technology development Global leader Wind, biomass, solar, ocean technology, CCS Note: Trading not included 4

6 We have a clear vision for the future We will accelerate renewable development secure long term supply of gas and electricity Examples Focus on wind by strong growth in installed capacity Growth in solar, biomass, ocean energy and CCS Pursuing climate neutrality by 2050 Significant growth of electricity production in Benelux by 2020 Diversified gas sourcing portfolio by increasing upstream gas positions offer attractive and competitive products for our customers Market share growth in energy savings advice and execution Large share of growth to come from new products and services 5

7 Agenda Nuon & Vattenfall: a great partnership Rationale for Nuon Rationale for Vattenfall Key terms Benefits for stakeholders Lars G. Josefsson Lars G. Josefsson 6

8 Market developments have prompted the need for a partner for Nuon European Market consolidation Scale for efficient and reliable sourcing Security of supply requiring diversified portfolio Financial strength for investments Increasing customer demands Capabilities and scale to maintain competitive prices Further shift towards renewables Renewable track-record and diversification Global competition for talent Ability to attract engineering and innovation skills 7

9 We have gone through a careful and collaborative process to select the best possible partner for Nuon Step 1 Establishing criteria and evaluation of partnering options, in close collaboration with supervisory board, shareholders and workers council; decision to initially sell minority share Step 2 Launch partnering process; selection of most attractive bids from long-list of players Step 3 Selection of best possible partner from short-listed group, based on strategic plan, stakeholder fit, governance, valuation, transaction certainty, and public assurances 8

10 With Vattenfall, Nuon has found a partner that fits in all respects Security of supply Support of Nuon strategy Client, employee, shareholder interests Cultural fit Scale and competence in power and heat Committed to a diversified gas sourcing strategy and gas upstream investments Increased access to coal, biomass gas and nuclear Significant role for Nuon, including lead role for group s gas competence Commitment to a diversified production portfolio Stable ownership Experience of competitive retail market Employer of choice Track record of excellent financial performance European leadership in CO 2 reduction Company values and culture well in line Focus on performance improvement Shared ambition in tackling climate change issues Shared stakeholder philosophy Experience with carbon capture & storage 9

11 We have agreed on a detailed strategic plan for the future Strategy Increased security of supply through a diversified gas sourcing strategy Objectives Increased investments in upstream and midstream gas Increase generation capacity, diversification and renewables Significant growth of electricity production in Benelux by 2020 Become the advisor on energy transition for our customers Diversified portfolio of products and services Optimize portfolio through trading and risk management Become leading Pan-European, multi-commodity energy trading house 10

12 Agenda Nuon & Vattenfall: a great partnership Rationale for Nuon Rationale for Vattenfall Key terms Benefits for stakeholders Lars G. Josefsson Lars G. Josefsson 11

13 Who are we? Välkommen to Vattenfall Making electricity clean Vision: to be a leading European energy company 100th birthday we started off as a hydro power company ( Waterfall ) Europe s fifth largest generator of electricity and the largest producer of heat Operations in Sweden, Finland, Denmark, Germany, Poland and the UK More than 32,000 employees, 4.7 mln electricity customers, and net sales of 15 bn (2008) Second largest player in off-shore wind Owned by the Swedish state Fully unbundled in home markets, Germany in process 12

14 Vattenfall has five strategic ambitions Number One for the Customer Number One for the Environment Benchmark of the industry Employer of Choice Continued Profitable Growth 13

15 Benelux energy market is highly attractive for Vattenfall Core markets Target markets Key elements Dutch market Well connected to our current markets Great CO 2 reduction and renewables opportunities Emerging as a biomass hub Dutch production capacity needs renewal Strengthening its role as a hub for European gas 14

16 Nuon is the perfect partner for Vattenfall Support of Vattenfall strategy Security of supply Client, employee, shareholder interests Cultural fit Drive growth in Benelux region Strong expertise in gas One of the best employers in NL Company values and cultures aligned Leadership in new technologies such as carbon capture and storage Enlarged wind project pipeline Further growth in power production and fuel diversification Significant trading competence and positions Leading retail position supported by high customer satisfaction Well run company and track record of performance improvements Professional, young international management Shared ambition in tackling climate change issues Performance culture 15

17 Nuon will be one of the three regional business groups Board of Directors CEO & Executive Group Management Group Shared services Group functions Business Group Pan-Europe Business Group Benelux* Business Group Nordics Business Group Central Europe ET&W Trading Wind Nuclear Engineering * Including leading role for group s gas competence 16

18 Agenda Nuon & Vattenfall: a great partnership Rationale for Nuon Rationale for Vattenfall Key terms Benefits for stakeholders Lars G. Josefsson Lars G. Josefsson 17

19 Key Terms of the binding transaction Valuation Vattenfall has offered 10.3 billion after 2008 dividend for 100% of Equity Value of Nuon PLB Implied 2008 EV/EBITDA multiple of 9.7 Equity value of 10.3 billion after 2008 dividend Effective date: 01-Jan-2009 All terms agreed, no further purchase price adjustments Partnership structure Vattenfall will acquire 49% of the outstanding shares of Nuon PLB at the time of the closing of the transaction Subsequent acquisition of the remaining 51% stake will take place in fixed tranches: 15% after two years, another 15% after four years and final 21% after six years A dividend yield will be paid per annum for the remaining value of the outstanding shares Vattenfall to obtain operational control as of closing of the transaction in order to consolidate Specific Governance rights for Nuon shareholders during transition phase Unbundling of Nuon including finalization process split up plan (to be completed shortly) Subsequent steps Transaction requires the following conditions and approvals: Approval by 80% Nuon shareholders of the Transaction and unbundling of Nuon Competition clearance Vattenfall and Nuon works council have given positive advice already Closing of the transaction expected to take place at the end of Q

20 Agenda Nuon & Vattenfall: a great partnership Rationale for Nuon Rationale for Vattenfall Key terms Benefits for stakeholders Lars G. Josefsson Lars G. Josefsson 19

21 Arrangements regarding governance Dutch shareholders Dutch shareholders will retain significant stake in Nuon Nuon adopts the large company regime, granting significant rights to minority shareholders Supervisory Board Nuon will have separate Supervisory Board with 8 members: Four members nominated by Vattenfall, including the Chairman, who will have a casting vote Four members nominated by remaining Nuon shareholders, including two nominated by the Works Council Five members will be Dutch residents Nuon foundation to protect public assurances Nuon Energy Public Assurance Foundation set up to protect the public assurances for at least 8 years, a.o.: Security of supply through investment in electricity production capacity and gas assets Nuon to remain at current locations (headquarters and other offices) Long term strategy in respect of renewables Nuon brand to be continued in Benelux for at least 4 years 20

22 We will continue to protect the interests of our society and environment Society Increased investments in gas assets to cover 10-20% of overall gas needs Continuation of R&D and advanced development projects, like gas storage and innovative multi-fuel plant Significant investments in existing and new power generation Environment Strong increase in both on- and off-shore wind development Aim to be carbon neutral by 2050 Sustain leading position on renewable technologies such as thin film solar, wind, biomass 21

23 and we will remain committed to customers and employees Customers We will continue to develop attractive and competitive offerings Continued focus on improving customer service Nuon s brand will be maintained for at least 4 years Employees Leading role in the further expansion of gas activities No closure of offices following the transaction No forced redundancies as a consequence of the partnership Shareholders Participate for six years Fair price for sale of shares Public assurances cornerstone of partnership 22

24 Questions and answers Jointly towards long term sustainable energy supply