RBC European Utils & Infra Morning Lightbulb

Research evidence excerpt

RBC European Utils & Infra Morning Lightbulb

think that this period of political instability is likely to continue for at least several months. In terms of the

potential impact for UK utilities, the outlook for UK Gilts under a Burnham premiership has improved in

our view since he has committed to existing fiscal rules, having previously claimed the government ‘isn’t

in hock to bond markets’. However, we think Burnham will still shift the party even further to the left,

particularly regarding the threat of a more interventionist approach to the economy, including in water

and energy. His policies remain vague and often contradictory at times, and we expect more clarity in

the coming weeks but we continue to view nationalisation as unlikely given the strained fiscal position

of the UK government.

Naturgy's Corporate Governance Restructuring

Naturgy has eliminated its reinforced majority voting system, reverting to ordinary majority decision-

making following the exits of CVC and BlackRock from its shareholder base, while significantly

streamlining its board from 16 to 11 members. The company appointed Enrico Letta, former Italian

Prime Minister, as an independent director, and Anke Groth, who developed most of her professional

career at E.ON. The reduction eliminated most of the six board seats held by the departing investment

funds, with only one retained for Letta's independent appointment. These governance changes position

Naturgy for a new growth phase with an estimated €7–9 billion in financial flexibility for strategic

acquisitions and investments through 2030, freed from the constraints imposed by the international

funds during their decade-long ownership. (Cinco Dias, El Economista)