Endesa, more Italian than ever?

MadridWhen José Bogas was appointed CEO of Endesa in 2014, he had one mission: to design a new industrial and investment plan in Spain, a market he knew firsthand because until then he was general manager of the business in the State and Portugal. Bogas took office with Endesa already in the hands of the Italian Enel, which today controls 70% of the share capital. And he did so, precisely, after the energy company had few assets left beyond those in the Iberian Peninsula: Enel had just acquired its operations in Latin America, which was seen as a first step to slim down Endesa.

Despite the Italianization of the company, the person in charge of managing Endesa and acting as an intermediary with the government continued to be a Spanish executive. On April 28, however, this will end. The general shareholders' meeting will vote on a new CEO, the Italian Gianni Vittorio Armani. Endesa will thus begin a new era with a leadership based in Rome: Juan Sánchez-Calero Guilarte, the president of Endesa, is Italian, as is the financial director, Marco Palermo.

Gianni Vittorio Armani is no ordinary executive. He is a man close to the Italian Prime Minister, Giorgia Meloni – it should be remembered that the Italian government is Enel's largest shareholder with almost 24% of the share capital–. Until now, he held the position of General Manager of Enel Girds e Innovation, a position to which he was promoted in July 2023, a few months after the upheaval in Enel's leadership. Meloni's government itself, elected Prime Minister of Italy six months before the earthquake in the energy company, decided to dismiss Enel's then CEO, Francesco Starace, who had been appointed by Matteo Renzi's social democratic government, and replaced him with Flavio Cattaneo. "[Francesco Starace] did not have the support of the Prime Minister's inner circle," reported the agency Reuters, which stated that one of Meloni's intentions was, precisely, to "impose her mark on Italy's main state-owned companies".

In addition, the change from Starace to Cattaneo led to a revival of Endesa's Italianization – the Spanish government of José María Aznar (PP) began to privatize the electricity company in 1997 and Enel absorbed it in 2009 after a battle triggered by Naturgy's takeover bid for the electricity company. José Bogas had been chosen by the executive dismissed by Meloni, which led to speculation about his precipitate departure.

New interlocutor

During the last twelve years, Bogas has been in charge of direct relations with the Spanish government and, in particular, with the Ministry for Ecological Transition. The end of his term – he is retiring at 71 years old – has been marked by different fronts that have led him to constant contact, in some cases even clashes, with Pedro Sánchez's executive: the unprecedented energy crisis of 2021, the approval of the extraordinary tax on the sector, the remuneration of the electricity grid, the extension of the operating life of nuclear power plants, or the massive power outage on April 28 last year. According to Expansión, in Moncloa, where they were aware of the change at Endesa, they would have preferred a Spanish executive. Government sources have declined to comment on this information.

Bogas undertook the "transformation" of a smaller Endesa that was to maintain "leadership" in the electricity sector in the State and focus on the business of renewables and decarbonization, betting on electrification, digitalization, and electric mobility, the company highlights. All this is included in the 2026-2028 Strategic Plan that Endesa launched just over a month ago and which, among other things, contemplates an investment of more than 10,600 million for the electricity grid.

Now, Vittorio Armani will have to continue doing this. One of the most urgent tasks is to maintain the momentum to extend the operating life of nuclear power plants, as Bogas advocated and as they want in Rome. In the case of the Almaraz plant, in Extremadura, the request for the schedule to be extended has been made. In Catalonia, the debate with Ascó I, Ascó II, and Vandellós II will have to be undertaken. Endesa owns the majority of the first two, while in Vandellós II it is shared with Iberdrola.

All in all, it should be taken into account that Enel's new management is closer to the ideals of the current Italian government, which, in addition to nuclear power, has shown particular interest in strengthening the country's gas sector. And not only that, but one of the Italian company's main challenges (and a great challenge for Enel's new leadership) is debt and how to liquidate it, which revives the idea of Endesa slimming down. In financial terms, the electricity company closed the year with earnings of 2,200 million euros, while net debt stands at 10,110 million euros, 9% more than in 2024.