• Gas Natural Fenosa’s shareholders, led by Isidro Fainé, agree unanimously to changes in the company to prepare for a new phase of transformation
  • Francisco Reynés will be in charge of driving the new Strategic Plan
  • Rafael Villaseca will continue to be associated with the Group as President of the Gas Natural Fenosa Foundation

The Board of Directors, meeting today in ordinary session, agreed unanimously to appoint Francisco Reynés Massanet as the new Executive Chairman of Gas Natural Fenosa, in order to lead the company into a new phase of transformation and growth.

They also agreed to appoint Isidro Fainé Casas as Honorary Chairman, ensuring the continuity of the company’s management values while it faces major challenges.

This decision forms part of the context of worldwide trends in energy business models, especially affecting technology, regulations, and capital markets.

Isidro Fainé congratulated the new Executive Chairman and expressed his support: “In the spirit of generosity, I am facing this new professional phase and welcoming the team led by Francisco Reynés, because I believe they are the ones who must drive the new Strategic Plan to lead the company towards transformation and growth.” He added: “Reynés has vision, perspective, foresight, and prestige in the financial markets. He is also an executive who knows how to handle risks well; he is a good communicator, and a man of integrity in professional and personal life.”

As Chairman of Gas Natural Fenosa from September 2016, Isidro Fainé led the company through a transitional stage, laying the foundation for its development and future growth through a variety of operations.

The first of these operations was the introduction of the GIP investment fund in the company’s shareholders, after an acquisition of 20%, evenly split, from Repsol and La Caixa. The markets considered the support of GIP a vote of confidence in the company and its robust business model. It is worth mentioning that in 2017 the company enjoyed the best stock market performance in the Spanish energy sector, with capitalization growth of 7.5%.

An important corporate transaction took place in the Spanish gas distribution business in August 2017, with the sale of 20% of this business. The transaction, for 1.5 billion euros in cash, was agreed with a consortium formed by Allianz Capital Partners (ACP) and Canada Pension Plan Investment Board (CPPIB), two long-term investors of recognised prestige in the infrastructure sector. GAS NATURAL FENOSA will continue to manage and consolidate the new Group company that handles this business, which was renamed Nedgia in January 2018.

In 2017 there were also two substantial divestment operations in Italy and Colombia. These two sales were the result of the asset review set out in the current Strategic Plan to optimise the business portfolio in territories considered to be non-strategic, and to provide value for shareholders.

The sale of the Italian assets, representing an effective withdrawal from the country, was agreed with the companies 2i Rete Gas, S.p.A. and Edison, S.p.A., for a total of 1.020 billion euros.

In Colombia, the company agreed the sale of its 59.1% share of GAS NATURAL S.A. ESP, the gas distribution and retail supply company. The transaction was agreed with the Canadian fund Brookfield for 483 million euros.

Meanwhile, under the leadership of Isidro Fainé the company continued to expand its activity in Latin America. In Mexico, it obtained two new concessions in the states of Campeche and Yucatán, in the south-east of the country. These new areas were added to regions like Sonora, Sinaloa, México D.F., Bajío Norte, and Bajío Sur, where the company has a potential market for gas of over 8 million people. The same year in Peru, it began supplying natural gas to customers in the four main cities.

Finally, in the social sphere, the Gas Natural Fenosa Foundation reinforced its Energy and Society line of action in 2017, focusing especially on vulnerable collectives. The foundation has made a major effort to launch various initiatives as part of an ambitious Energy Vulnerability Plan, developed with the company, mainly working on three initiatives: agreements with third sector organisations, the Energy School, and an energy volunteering programme for company employees.

The history of Isidro Fainé’s association with Gas Natural Fenosa

Isidro Fainé’s connection to the company goes back to 1992, when he was made a Director. At that time he was already taking an active part in the creation of Gas Natural SDG, the result of the integration of the gas distribution sector in Spain with the merger of Catalana de Gas, Gas Madrid and Repsol Butano’s piped gas shares. This historic merger led to the new brand Gas Natural and the famous butterfly logo, which at the time was an avant-garde innovation in branding among the world’s power companies.

He also played a decisive part in the company’s Board of Directors in December 1992, in connection with the international expansion of Gas Natural, with the creation of Gas Natural BAN en Argentina, after winning the bidding for the privatisation of the public distribution company in the Buenos Aires Norte area, and later in the acquisition of various gas distributors in Brazil, Colombia, and Mexico.

This period saw the Maghreb–Europe Gas Pipeline come into service in 1996, and the company’s activities were reorganised to fit the new framework of increasing deregulation after the Hydrocarbons Act was passed in 1998.

Later, in the year 2000, he also took part in the launch of electricity marketing in the liberalised Spanish market, and in 2002 at the start of combined cycle power generation in San Roque (Cádiz) with a 400 MW generator group, the first to operate in Spain, and another 400 MW one in Sant Adrià del Besós (Barcelona).

Fainé was also present for the 2003 decision to acquire the company EcoEléctrica, in Puerto Rico; and in the purchase of the renewable energy company DERSA, a strategic move which made Gas Natural one of the main wind power operators in Spain.

And outside the Board of Directors, in his role as Chairman of “la Caixa” Group, the main shareholder of Gas Natural, Isidro Fainé supported the company’s merger with Unión Fenosa in 2008, when not everybody believed in it. The market strongly backed the operation with the new company’s share price growing faster than the European average. After the merger, Gas Natural Fenosa became the most profitable European power company for shareholders, at a cumulative 7.4% in 2010-2017.

Francisco Reynés will lead the new Strategic Plan

The new Executive Chairman, who the Board of Directors has tasked with creating the company’s new Strategic Plan, said: “It is an exciting challenge to become the Executive Chairman of Gas Natural Fenosa, a company I feel very close to, having already spent a very happy part of my professional life here, at a time when the worldwide energy sector is seeing significant technological and regulatory changes.”

The former Deputy Chairman and Managing Director of Abertis, who has worked directly with Isidro Fainé for over 10 years, was the General Manager of Resources at Gas Natural Fenosa in 2006.

Reynés is an Industrial Engineer by profession, having studied mechanical engineering at the University of Barcelona. He has an MBA (Master in Business Administration) from IESE and has studied senior management programmes in the US and Germany.

In 2007 he was General Manager of Criteria Caixa Corp, the business holding company of “La Caixa”. In that position, he oversaw the company’s entry on the Stock Exchange in October of the same year. From 2002 to 2006 he was Managing Director of the cement company Uniland. Previously, he was a member of the Board of Directors of Aguas de Barcelona, Segur CaixaHolding, Adeslas, and Port Aventura.

Rafael Villaseca, President of the Gas Natural Fenosa Foundation

The Board of Directors unanimously thanked and congratulated Rafael Villaseca for his work in the company as Managing Director since 2004, and ratified his appointment as President of the Gas Natural Fenosa Foundation.

Isidro Fainé wanted to “highlight the positive and useful work of Villaseca throughout his time as CEO, especially his close and honest collaboration with me as Chairman.”

From 2004 to the present, the period he spent as CEO, Rafael Villaseca was instrumental in some of the milestones marking the growth and the successful international launch of the company, which has gone from a mainly gas-based business to a major multinational energy group.

In this period, GNF’s turnover quadrupled, its customers multiplied by 2.3 to over 18 million, and its internationalisation increased, tripling the number of countries where it operates and doubling its net profits. The company has maintained a stable growth plan since 2004, enabling it to consolidate its position in Europe, with the start of marketing in France, Belgium, and Luxembourg; to open the LNG market in Asia; and to sign the first contract to supply liquefied natural gas with the United States.

Other notable milestones under the leadership of Rafael Villaseca include the 2014 creation of the company Global Power Generation (GPG), to drive the generating business outside Spain, together with the Kuwait Investment Authority (KIA). Also in 2014, Gas Natural Fenosa successfully concluded the purchase of the Chilean Compañía General de Electricidad (CGE), becoming a leading operator in Chile and consolidating its presence in seven of the main Latin American capitals.

 

Madrid, 6 February 2018.

Images

From left to right, Isidro Fainé, Francisco Reynés, and Rafael Villaseca.