ENEL TO SEEK STOCK MARKET LISTING FOR TERNA, PROCEED WITH BINDING OFFER FOR 2 ROMANIAN ELECTRICITY DISTRIBUTORS, AND EXIT WATER SECTOR

Published on Tuesday, 2 March 2004

Rome, 2 March 2004 – The Board of Enel, chaired by Piero Gnudi, met today and confirmed its intention to seek a listing for approximately 50% of the capital of Terna. The Board authorized the presentation of a prospectus to Consob and the lodging of a request for stock market quotation with the Italian stock exchange, Borsa Italiana.
The Board also decided to modify Terna’s statutes to include recent changes to company law, as well as changes to regulations for listed companies, with particular attention to the introduction of clauses protecting minorities (slate vote system, etc.). These modifications will be approved during a Terna shareholders meeting scheduled for March 3, 2004.

Terna is 100%-owned by Enel and, in turn, owns 94% of the national high voltage electricity network. It specializes in the planning, construction, remote monitoring, remote management, operation, maintenance, renovation and development of electricity transmission systems. The company has over 38,000 kms of high voltage power lines and 295 substations. In 2003, Terna had revenues of approximately 877 million euro, a gross operating margin (Ebitda) of approximately 595 million euro and a net profit of approximately 123 million euro.

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The Board also today approved the presentation of a binding offer for the acquisition of a majority stake in two Romanian electricity distribution companies, Banat and Dobrogea, which together serve 17% of the country’s customers. The Banat Electrica network covers four western regions, including the area of Timisoara, and serves 850,000 customers (10% of the country’s total customers). The Dobrogea Electrica network covers four eastern regions, including the area of Costanza on the Black Sea, and serves 590,000 customers (7% of total customers).

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As a part of Enel’s strategy to focus on its core electricity and gas businesses, the Board approved a progressive exit from the water sector. This will be implemented through the sale of Enel Hydro by direct negotiation, once the activities of planning, engineering and water treatment (Ismes, etc.) have been transferred to a new company. These activities will be individually enhanced and sold. Oonce those activities have been removed, Enel Hydro will contain concessions and participations in the water sector in Calabria, Campania and the province of Latina.

Price Sensitive | March, 02 2004

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