• GEK TERNA and Motor Oil strategically reposition in the electricity market, creating value for their shareholders.

• Heron and nrg will merge, with equal participation of GEK TERNA and Motor Oil, into a new corporate entity (UtilityCo) that will play a significant role in the electricity market in Greece and Southeast Europe

• UtilityCo will serve a portfolio of 550,000 electricity and natural gas customers and have 1.5GW of generation capacity. 

• New UtilityCo to achieve further vertical integration and realise significant synergies across all activities

• Transaction to be completed by early 2026, pending the receipt of customary regulatory approvals

GEK TERNA and Motor Oil announce the signing of a binding agreement for the merger of their activities in the supply of electricity and natural gas and the generation of electricity from natural gas-fired units. In more detail, Motor Oil will contribute 100% of nrg, its 50% stake in Komotini CCGT along with a cash amount of EUR 79m. GEK TERNA will contribute 100% of Heron and its 50% stake in Komotini  CCGT, while it will receive a cash amount of approximately EUR 128m (including the previously mentioned EUR 79m and additional cash amounts through a pre-defined permitted leakage mechanism). Above cash considerations are subject to confirmatory due diligence. 

Under the agreed framework a new corporate entity will be established (UtilityCo), in which GEK TERNA and Motor Oil will hold equal participation and voting rights. UtilityCo will eventually own Heron and nrg as well as the new natural gas fired unit (CCGT) in Komotini. Beyond the Komotini CCGT, that has a capacity of 877 MW, UtilityCO will also have full control of Heron II natural gas fired unit (CCGT) with a capacity of 441 MW and also hold a 35% stake in Korinthos Power natural gas fired unit with a capacity of 437 MW. UtilityCo will serve in total 488,000 electricity customers, representing total volume sales of about 8.3 TWh and hold a market share of approximately 17% (based on end-2024 data). Moreover it will serve 61,000 customers of natural gas, with a respective market share of 11%. 

The combination of an enlarged customer base with the most efficient portfolio of generation capacity will establish a highly effective vertically integrated structure that will have the knowhow and will be supported by GEK TERNA and Motor Oil, two of the biggest Groups in the country with a proven experience in the energy sector. With a leading position in the market, the new corporate entity will be best positioned to achieve higher growth rates and superior financial results, while more effectively addressing the challenges of energy transition. The merger of Heron and nrg will achieve significant synergies across all critical operations like procurement, commercial activity and energy management, creating significant value for the consumers and the shareholders. 

Electricity demand in Greece is anticipated to increase by 2.4% CAGR up to 2030 driven by global mega-trends. Aτ the same time the local supply market remains fragmented, with sub-scale players controlling about 10%. This creates a growth opportunity in the supply of electricity by capturing an addressable market of over 11TWh for the coming years. Also the acceleration of RES penetration with the anticipated addition of about 6.0 GW of wind and PV capacity during 2025-30 will increase significantly the system needs for balancing capacity.

The transaction is expected to be completed by early 2026, pending the completion of the due diligence process as well as the receipt of relevant approvals from regulatory bodies and the general assemblies of the two stakeholders.

GEK TERNA retained Mediobanca as sole financial advisor, Sioufas & Associates as legal advisor, while EY provided tax and accounting advice and services in connection with the Transaction. 

Motor Oil retained Morgan Stanley as sole Financial Advisor, Potamitis Vekris as Legal Advisor, while Deloitte provided tax and accounting advice and services in connection with the Transaction. 

The significant impact of GEK TERNA Group on the national economy and society is once again confirmed by the “Socio-Economic Impact Assessment (SEIA) for the Year 2024.”

The study’s findings indicate that the Group’s strategy is designed and implemented with a core focus on sustainable development. This approach aligns with social responsibility, environmental protection, and places people and the prosperity of local communities at the center.

According to the study, the Group contributed €5.9 billion to Greece’s GDP in 2024. Specifically, the Group’s total contribution represents 2.5% of the country’s overall GDP. This amount is, on average, approximately 2.3 times higher than the average contribution over the 2022–2023 period.

At the same time, the Group’s total impact on national public revenues amounted to €1.1 billion, a figure equivalent to 1.5% of the country’s total tax revenues for the year 2024. This amount is, on average, 2.8 times higher compared to the 2022–2023 period.

GEK TERNA Group’s direct contribution to GDP is estimated at approximately €4 billion. In addition, the Group’s extensive supply chain that includes suppliers, service providers, and other partners, generates a further €1.3 billion through indirect impacts. These impacts stem from the procurement of goods and services essential to the Group’s operations, stimulating economic activity across various sectors and reinforcing the broader economic ecosystem. Finally, the total induced impact amounts to €624 million, reflecting the ripple effects from the spending of employees and others who benefit from the Group’s direct and indirect activities.

GEK TERNA also has a particularly significant impact on employment. In 2024, the Group’s activities, along with those of its partners, supported approximately 37,000 jobs. Notably, these jobs accounted for 0.9% of total employment in Greece for the year 2024. It is also worth highlighting that for every direct job at GEK TERNA Group, an additional seven (7) jobs are supported across the broader Greek economy, demonstrating the Group’s strong multiplier effect on national employment.

GEK TERNA Group continued to implement its Corporate Social Responsibility (CSR) program without interruption in 2024, investing €4 million in social support initiatives. The Group remains firmly committed to sustainable development, the well-being of local communities, and the empowerment of young engineers through the “Skillful Generation” program. Promoting inclusion and addressing the needs of its stakeholders continue to be core pillars of the Group’s strategic actions.

The five (5) core pillars of the Group’s Corporate Social Responsibility (CSR) program focus on health and healthcare, education, culture, the environment, and emergency support. Notable examples of interventions in critical situations include the Group’s initiative to fully restore the Penteli Indoor Gymnasium following the 2024 wildfire, as well as the rehabilitation efforts in the Mandra-Magoula area. These efforts were supported through the funding of both the study and execution of anti- erosion projects, valued at €1 million.

For the preparation of the Socio-Economic Impact Assessment of GEK TERNA Group, a widely recognized methodology, based on the model of Nobel Prize-winning economist Wassily Leontief, was used. The methodology applies the “Input-Output” analysis model, which allows the identification and quantification of the Group’s impacts across various sectors of the economy and society. The study was conducted with the contribution of PwC Business Solutions S.A. as part of a broader collaboration to provide consulting services on sustainable development issues for GEK TERNA Group.