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Elia publishes interim information for the first quarter of 2010 and confirms that it has the intention to launch a capital increase to finance acquisition of 60% of German transmission system operator 50Hertz Transmission GmbH •

Belgian transmission system operator accelerates publication of interim information on first quarter of 2010 and discloses additional details on acquisition of 60% of German transmission system operator 50Hertz Transmission GmbH (hereafter “50Hertz”) in view of shareholders’ meeting of 11 May 2010.

Elia confirms intention to launch a capital increase, subject to market conditions, in order to raise up to EUR 300 million for the financing of the acquisition of 60% of 50Hertz.

Elia and TenneT make a further contribution to the development of European market with the consolidation of the energy exchanges Belpex and APX Endex.

Electrabel sells part of its shares to Publi-T.

Financial position and results of Elia since 1 January 2010 Results 2010 As it was the case for previous years, the regulated results after tax of Elia for 2010 will consist of three elements: •

• •

the fair remuneration on the regulated asset base which is calculated on the basis of the actual value of the Belgian ten-year interest rate (daily average) and the actual beta of the Elia share multiplied by a fixed risk premium of 3.5%; offsetting in tariffs of the decommissioning of fixed assets. According to Elia estimates, this will amount to EUR 14.2 million in net profit for 2010. By law, this portion of the net profit must be reserved to fund future investments; the savings in operating expenses in excess of the savings imposed by Royal Decree (EUR 7 million for 2010). If less than EUR 25 million is saved over a

four-year period, the shortfall is at charge of Elia. In the event that Elia saves more than the stated amount, these additional savings (up to a maximum of EUR 25 million) are included in the net profit over a four-year period. For the period 2010-2011, a maximum amount of EUR 14.3 million can be saved for the benefit of the shareholders, as already EUR 10.7 million of savings have been achieved in 2008 and 2009 in excess of the mandatory savings. In addition, subject to closing of the acquisition of 50Hertz (see below for more details) the net result for 2010 will also be influenced by 60% of the net results generated by 50Hertz. However, 50Hertz will only be consolidated in Elia’s consolidated financial statements as from 1 June 2010. As the results over 2010 depend on parameters that will not be known until the end of 2010, Elia cannot give specific profit forecasts for 2010. Dividend 2009 The board of directors will propose to the annual shareholders’ meeting due to be held on 11 May 2010 to distribute a dividend of EUR 1.38 per share. Investments 2010 In accordance with the multi-annual tariffs plan, it is currently expected that Elia (excluding 50Hertz) will invest a total amount of EUR 615.6 million over the period 2008-2011. The investment plan was adjusted to take into account the sharp fall in volumes since late 2008, due to the weak economy, and delays in projects of customers. The investments in 2010 (mainly related to the upgrading of high voltage stations and the installation of high voltage cables) will be reduced to auto-financing capacities.

Material events and transactions that have taken place since 1 January 2010 Acquisition of 50Hertz Elia announced on 12 March 2010 that it had reached a deal for the acquisition, with Industry Funds Management (“IFM” - see below, “arrangements with IFM”), of German transmission system operator 50Hertz from Vattenfall Europe AG. Closing of the transaction is mainly subject to the relevant competition authorities’ consent and the absence of events which may result in a material adverse change in the business of 50Hertz. The closing conditions have to be fulfilled within four months after 11 March 2010. While not all closing conditions have been fulfilled yet, it is currently expected that the transaction could be closed in the course of May 2010. Strategic rationale The acquisition of 50Hertz fits one of the cornerstones of Elia’s long term strategy, considering that national power markets in Europe will evolve in an accelerating pace towards European regional power markets. The transaction aims at consolidating the role of Elia in the development of the Central West European market in a context of regional integration. The transaction is a crucial step towards the further integration of wind energy in the Central West European network and the development of the future North Sea grid, in the context of which important investment projects are

foreseen by 50Hertz to increase its network capacity to transfer excess energy to consumption areas with high load and to integrate new conventional power plants and renewable energy sources. Financial terms and impact on the IFRS financial situation of Elia The purchase price for the equity of 50Hertz amounts to EUR 464.6 million. Elia and IFM (through their joint subsidiary Eurogrid GmbH) also take over a shareholder loan in the amount of 320 million (subject to certain adjustments for changes in the cash situation between 1 January 2010 and the closing date). This shareholder loan will be replaced with bank debt (two year loan facility).Of the total purchase price, 60% will be funded by Elia (EUR 278.8 million) and 40% will be funded by IFM. Based on currently available information, it is estimated that 50Hertz’ equity as of 31 December 2009 (under IFRS as applied by Elia) would amount to 890.5 million EUR, while the estimated total assets of 50Hertz as of 31 December 2009 (under IFRS as applied by Elia) would amount to EUR 2.096,40 million. Due to the fact that the preliminary fair value of the acquired assets exceeds the acquisition price, a positive amount will most likely have to be recognised as profit by Elia in 2010. Based on a preliminary assessment of the fair value of the net assets of 50Hertz done in the context of the preparation of the contemplated capital increase, a one-off profit (gain on bargain purchase) of EUR 255.5 million would have to be recognised by Elia. The impact of the transaction on the financial position of Elia is shown in the table below (as if the acquisition occurred on 1 January 2009). This is prepared for illustrative purposes only, addresses a hypothetical situation and therefore does not represent Elia’s actual or future financial position or results. More financial information is scheduled to be released early in the week of 10 May 2010.




Indicative consolidated figures (Elia+60% of 50Hertz) (2)



Estimated change in %

Consolidated turnover







Operating result (EBIT) Operating result before gain on bargain purchase

















Total assets Equity attributable to the equity holders of the company





Net financial debt



Income statement (€ million)

Financial result Taxes Consolidated net profit attribuable to the equity holders of the company

Balance sheet (€ million)





28,7% (5)

40,0% 6,01%%

(1) Based on Elia's 2009 consolidated financial statements under IFRS. (2) Based on Elia's 2009 consolidated financial statements under IFRS and the estimated impact of the restatement of 50Hertz 2009 accounts to IFRS. (3) EBITDA = EBIT + depreciation + changes in provisions. (4) Estimated bargain on purchase price of 255,5 million EUR is included as a one-off net profit. (5) Taking into account the capital increase of January 2010 and assuming a capital increase of EUR 300 million.

Financing of the acquisition – capital increase of Elia In order to finance its portion of the purchase price, Elia intends to increase its capital with an amount of up to EUR 300 million through the issue of new shares, currently expected to occur before the end of June 2010 (subject to market conditions). Elia has appointed a syndicate of KBC Securities, ING, Dexia and BNP Paribas to assist on the transaction. A first draft prospectus has been filed with the Belgian competent authority (CBFA). Elia has secured bridge financing for the period between the closing of the acquisition of 50Hertz (expected in May) and the finalization of the capital increase (currently expected at the end of June). Agreements with IFM In view of the acquisition, Elia and IFM have set up a holding company, Eurogrid International CVBA/SCRL, the shares of which are owned for 60% by Elia and for 40% by IFM. The shares of 50Hertz will be acquired through Eurogrid GmbH, a 100% subsidiary of Eurogrid International CVBA/SCRL. Elia and IFM have entered into a

shareholders’ agreement providing for the obligations of each of the parties in respect of Eurogrid International. Elia and IFM will be represented in the Eurogrid companies and 50Hertz proportionately to their shareholding and jointly control certain significant matters relating to the business of Eurogrid International. Eurogrid GmbH has secured a long term Credit Facility with The Royal Bank of Scotland NV, ING Bank NV, BNP Paribas Fortis and Dexia Bank Belgium SA/NV for an amount of EUR 850 million. About EUR 320 million will be used immediately to repay an existing shareholder loan between 50Hertz and Vattenfall Europe AG. The remaining part of the financing will be used to finance future capex and working capital needs of Eurogrid GmbH and its subsidiaries. Eurogrid GmbH is considering replacing the bank financing with long term Eurobonds (“bridge to bonds”). Eurogrid GmbH is currently in the process of obtaining a public rating for that purpose. More information on the acquisition of 50Hertz More information and background on the rationale and the terms of the acquisition of 50Hertz, the business of 50Hertz and the regulatory framework in which its operates, and the agreements entered into between the Company, Vattenfall and IFM can be found in an information notice which is was made available on the Elia website ( Integration of Belpex and APX Endex On 19 April 2010, Elia announced that it would acquire a 20% shareholding in the Dutch power and gas exchange APX-Endex (“APX-Endex”) through the subscription of a capital increase of APX B.V. TenneT will keep 56.1% of the shares of APX-Endex, Nederlandse Gasunie 20.9% and Fluxys NV 3%. Elia will also be represented in the corporate bodies of APX-Endex. At the same time, Elia and TenneT announced that they had entered into an agreement for the sale of their shares in Belpex (jointly representing 70% of the total outstanding share capital of Belpex SA/NV) to APX-Endex. As result of the transaction Belpex NV would become a 100% subsidiary of APX Endex. The transaction comes down to an effective integration of Belpex and APX Endex, in line with the strategic objectives of Elia, TenneT, Belpex and APX-Endex to contribute to the further integration of the European energy markets. The transaction is subject to certain regulatory approvals (including by the relevant competition authorities) being obtained. It is intended that the transaction is closed by October 2010.

Sale of shares by Electrabel to Publi-T On 30 March 2010, Publi-T and Electrabel have announced an agreement as to the modalities of the exit of Electrabel as a shareholder of Elia. In that framework, Electrabel has agreed to sell to Publi-T CVBA/SCRL 6,035,522 shares of Elia representing 12.5% of the share capital of Elia at a price of EUR 26.5 per share and for a total amount of EUR 159,941,333. At that occasion, Electrabel has repeated its intention to also sell its remaining shares in Elia.

Financial calendar 11 21 26 27 12

May 2010: Ordinary and Extra-ordinary shareholders' meeting May 2010: Elia is trading ex coupon 5 before market opens May 2010: Payment of the dividend for 2009 (coupon 5) August 2010: Publication of half-year results 2010 November 2010: Interim information after nine months 2010

This press release covers the interim information which was announced to be released on 14 May 2010. About Elia Elia is the Belgian transmission system operator, transmitting electricity from producers to distribution system operators and major industrial users. Elia is also responsible for importing and exporting electricity from and to neighbouring countries. Elia owns the entire Belgian very-high-voltage grid (150 to 380 kV) and around 94% (ownership and user rights) of the Belgian high-voltage grid (30 to 70 kV). Elia's grid comprises 5,645 kilometres of overhead lines and 2,767 kilometres of underground cables, and is a key link between electricity markets in northern and southern Europe. As a result of recent investment in interconnection capacity with neighbouring countries, Belgium has become one of the most open and interconnected countries in Europe. For more information, please contact Elia: Media: Eva Suls Lise Mulpas

+32 2 546 73 78 +32 2 546 73 75

Investor Relations: Bert Maes

+32 2 546 72 39

+32 477 48 80 09 +32 478 65 28 90 +32 472 40 69 97