Eni, advised by JPMorgan, is seeking to sell a stake of up to 49% in Enipower in a deal that could value the company at 1.2 billion euros ($1.4 billion), the government said. one of the sources familiar with the matter.
The sale should be finalized by the end of the first quarter, the source said.
BlackRock has also considered an offer for the asset, but a source familiar with the talks said interest in the fund has cooled.
The companies all declined to comment.
Enipower, one of Italy’s largest electricity producers, operates five gas-fired power stations and one cogeneration plant in Italy, with a total capacity of over 5 gigawatts.
As climate change concerns drive economies towards a lower carbon future, investing in fossil fuel assets is seen by some as a riskier bet than before.
Eni, which has pledged to be carbon neutral by 2050, is selling its stake to fund its shift from oil and gas to cleaner activities.
The group has merged its retail and renewable energy generation businesses and plans to list part of that unit this year in what could be one of Italy’s biggest IPOs of the year.
($1 = 0.8766 euros) (Reporting by Stephen Jewkes; Editing by Mark Potter)