Masdar to acquire 49.99% stake in Endesa’s 446 MW solar portfolio in Spain

Abu Dhabi Future Energy Company PJSC (Masdar) is further expanding its footprint in Europe’s renewable energy sector with a significant investment in Spain. In a deal valued at €368 million, Masdar has agreed to acquire a 49.99% stake in four operational solar photovoltaic plants owned by Endesa S.A., reinforcing its presence in one of Europe’s fastest-growing solar markets. These assets, with a combined installed capacity of 446 megawatts (MW), are expected to contribute to Spain’s ambitious clean energy goals.

The agreement, announced on March 24, 2025, follows an earlier partnership between Masdar and Endesa in December 2024, when the UAE-based clean energy giant acquired a 49.99% interest in a 2-gigawatt (GW) solar portfolio. That deal also included the potential integration of 500 MW of battery energy storage systems (BESS), further aligning with Spain’s National Energy and Climate Plan (NECP) and the EU’s Net Zero 2050 targets.

This latest transaction highlights Masdar’s long-term strategy of investing in strategic renewable assets across Europe while expanding its partnership with major energy operators like Endesa. As part of the agreement, Masdar will invest €184 million for the minority stake, with the deal subject to customary regulatory approvals, including clearance from Spanish authorities on foreign investments.

Why Is This Investment Significant for Endesa and Masdar?

For Endesa, one of Spain’s leading energy providers, the partnership with Masdar aligns with its 2025-2027 Strategic Plan, which focuses on maintaining control over key renewable assets while attracting external investment to maximize growth. Endesa will continue to fully consolidate the solar assets under its subsidiary, Enel Green Power España Solar 2, S.L.U. (EGPE Solar-2), ensuring operational control and strategic oversight.

A key component of the agreement is the inclusion of 15-year power purchase agreements (PPAs), under which Endesa will procure the electricity generated by these solar farms. This structure enables the company to secure long-term renewable energy supply, stabilize revenue streams, and reduce market volatility.

For Masdar, the investment marks another strategic expansion in the Iberian Peninsula, where the company has been actively growing its renewable energy footprint. Masdar’s total operational capacity in the region has now reached 3.2 GW, positioning it as a major player in Spain and Portugal’s clean energy landscape.

This transaction builds on Masdar’s broader European ambitions, which include its Memorandum of Understanding (MoU) with Enel Group, Endesa’s parent company. The MoU aims to explore renewable energy opportunities in Italy, Spain, and Germany, reinforcing Masdar’s commitment to scaling up clean energy investments across Europe.

How Does This Deal Impact Endesa’s Stock Performance?

As a publicly traded company listed on Bolsa de Madrid (BME: ELE), Endesa’s stock has shown strong performance over the past year. As of March 21, 2025, shares were trading at €23.48, reflecting a 41.11% increase year-over-year, significantly outpacing the broader Spanish market’s 15.6% return.

Endesa’s valuation metrics indicate solid financial health, with a price-to-earnings (P/E) ratio of 13.16 and a price-to-sales ratio of 1.17. The company maintains a return on investment (ROI) of 7.02% and a return on equity (ROE) of 4.82%, demonstrating its ability to generate steady returns for investors.

The company also remains an attractive choice for income-focused investors, offering an annual dividend yield of 5.74%, with the next ex-dividend date scheduled for June 27, 2025. Despite the stock’s strong rally, analyst consensus rates Endesa as a “Moderate Buy,” with an average price target of €22.37, suggesting a slight downside from current levels. Given the stock’s proximity to its 52-week highs, some market analysts recommend a “Hold” strategy, advising investors to monitor market corrections and regulatory developments related to the Masdar deal.

What Is Masdar’s Broader Renewable Energy Strategy?

Although Masdar is not publicly traded, its financial position remains robust. In the first half of the current fiscal year, the company reported revenues of AED 1.26 billion, up significantly from AED 781.34 million in the same period the previous year. Masdar’s gross profit for this period stood at AED 286.65 million, reflecting its strong earnings potential.

Masdar’s creditworthiness has also improved, with Fitch Ratings upgrading its credit rating to ‘AA-‘ in July 2024, citing its stable financial outlook and strategic growth initiatives. The company continues to expand its global renewable energy portfolio, which currently exceeds 50 GW, with a target of 100 GW by 2030.

Masdar has also been actively acquiring clean energy assets across Europe and the Middle East, including its purchase of Saeta Yield, a renewables platform with a 745 MW operational wind portfolio and a 1.6 GW development pipeline in Spain and Portugal.

By strengthening its partnership with Endesa and exploring new renewable opportunities with Enel Group, Masdar is positioning itself as a leading investor in Europe’s clean energy transition.

How Is the Masdar-Endesa Partnership Reshaping Spain’s Solar Market?

Spain has emerged as one of the fastest-growing solar energy markets in Europe, with the government aggressively expanding its renewable energy targets under the National Energy and Climate Plan (NECP). The country aims to increase its installed solar capacity to 39 GW by 2030, a goal that aligns with the EU’s broader decarbonization strategy.

The Masdar-Endesa partnership represents one of Spain’s largest renewable energy transactions, reinforcing the country’s position as a key player in the global clean energy transition. By combining Endesa’s operational expertise with Masdar’s investment strength, the two companies are creating a model for long-term sustainable growth in the solar sector.

This transaction also highlights the growing trend of international investors entering the Spanish renewable energy market, attracted by the country’s favorable regulatory framework, strong infrastructure, and government incentives.

With Spain accelerating its clean energy transition, partnerships like Masdar and Endesa’s are expected to play a critical role in advancing solar energy adoption, enhancing grid stability, and supporting Europe’s long-term net-zero ambitions.