In October 2012 the Irish Government requested ESB to develop proposals for the sale of some non-strategic generation capacity, with the specific objective of delivering special dividends to the Government of €400M by the end of 2014. 

In February 2013, ESB started this process by announcing that it intended to sell its 50% shareholdings in two international tolling plants, Marchwood Power Limited (UK) and Bizkaia Energia SL (Spain).  The sales of these assets have been successfully completed, and special dividends totalling €197m from the proceeds of the sales were paid to the Government earlier this year. 

In October 2013 ESB announced that it also intended to sell two peat stations, West Offaly Power and Lough Ree Power, to generate further special dividends.

Since this announcement, detailed analyses have been carried out in preparing the assets for sale. These indicate that it will be financially more beneficial to both ESB and the Government for ESB to retain ownership of the peat plants and fund the payment of the remaining amount of the special dividend target by drawing down additional debt from ESB’s bank facilities.  

It is now ESB’s intention that the peat plants and their associated cashflows will be retained, and will be available to the company to support the additional funding requirements arising from payment of the special dividend.  This course of action means that rather than selling the physical assets and getting upfront proceeds to enable payment of the special dividend,  the cashflows from the assets will be utilised in a different manner to yield an overall better financial result, but with the substance of the approach being the same as if the assets had been sold.

At ESB’s Board Meeting today (28th July 2014) the Board approved the remaining special dividend for payment to ESB’s shareholders. This payment will complete ESB’s commitment to the special dividend request, and no further transactions under this programme are envisaged. 

ENDS