Iberdrola (AO) | Buy | Finnish deal: Expanding regulated networks in another quality market

Research evidence excerpt

Iberdrola (AO) | Buy | Finnish deal: Expanding regulated networks in another quality market

News comment

Release date: 22 July 2026

Jose Porta

Equity Research Analyst

+34 914 36 5113

jporta@keplercheuvreux.com

BuyIberdrola

Spain | Utilities Beta Profile: MCap: EUR140.1bn

Target Price: EUR17.30 Bloomberg: IBE SM Reuters: IBE.MC

Current Price: EUR21.32 Free float 85%

Up/downside: -18.9% Avg. daily volume (EURm) 417.8

YTD abs performance 15.5% Market data: 21 July 2026

52-week high/low (EUR) 21.84/15.15

Finnish deal: Expanding regulated networks in another quality market

Key points:

Iberdrola acquires 80% of Finland's largest DSO for c. EUR2bn equity value (EUR5bn 100% of EV), with closing expected in Q1-27E.

Immediately EPS accretive, with no upside assumptions embedded despite multiple operational and regulatory growth

opportunities.

Reinforces Iberdrola's regulated networks strategy while maintaining disciplined capital allocation and balance sheet strength:

The deal will be funded via capital redeployment from the second Mexican disposal.

Transaction overview: EUR2bn for an 80% equity stake

Iberdrola has agreed to buy an 80% stake in Caruna, Finland's largest electricity distribution company, entering into another

highly rated (AA+) regulated electricity market.

The transaction values Caruna at an enterprise value of around EUR5bn (100%), including EUR2.47bn of net debt, while Iberdrola

will pay approximately EUR2bn for the 80% equity stake, with EUR1bn of that consideration deferred for 30 months after closing.

The acquisition will be funded through capital recycling following the sale of the remainder of Mexico's thermal generation

business and is expected to be completed during Q1-27E.

Shareholder structure and partnership model