FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of April, 2006
Commission File Number: 333-132076
GAS NATURAL SDG, S.A.
(Translation of Registrant’s Name into English)
Av. Portal de L’Angel, 20-22
08002 Barcelona, Spain
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file
annual reports under cover Form 20-F or Form 40-F:
| Form 20-F x | Form 40-F ¨ |
Indicate by check mark if the registrant is submitting the Form 6-K
in paper as permitted by Regulation S-T Rule 101(b)(1):
| Yes | ¨ | No | x |
Indicate by check mark if the registrant is submitting the Form 6-K
in paper as permitted by Regulation S-T Rule 101(b)(7):
| Yes | ¨ | No | x |
Indicate by check mark whether by furnishing the information
contained in this Form, the Registrant is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:
| Yes | ¨ | No | x |
If “Yes” is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b):N/A
The following is a translation of a Spanish presentation delivered today in the general meeting of shareholders of Gas Natural SDG, S.A. In case of discrepancies, the Spanish version will prevail.
 Extraordinary General Shareholders Meeting 7 April 2006 |
 In connection with the offer by Gas Natural SDG, S.A. (Gas Natural) to acquire 100% of the share capital of Endesa, S.A. (Endesa), Gas Natural has filed with the United States Securities and Exchange Commission (SEC) a registration statement on Form F-4 (File No.: 333-132076), which includes a preliminary prospectus and related exchange offer materials to register the Gas Natural ordinary shares (including Gas Natural ordinary shares represented by Gas Natural American Depositary Shares (ADSs)) to be issued in exchange for Endesa ordinary shares held by holders located in the United States and for Endesa ADSs held by holders wherever located. At the appropriate time, Gas Natural will file a Statement on Schedule TO with the SEC. Holders of Endesa ADSs and U.S. holders of Endesa ordinary shares are urged to read the registration statement, the preliminary U.S. prospectus and the related exchange offer materials, the final U.S. prospectus and Statement on Schedule TO (when available), and any other relevant documents filed with the SEC, as well as any amendments and supplements to those documents, because they will contain important information. Investors and security holders may obtain free copies of the registration statement, the preliminary U.S. prospectus and related exchange offer materials, and the final prospectus and Statement on Schedule TO (when available), as well as other relevant documents filed with the SEC, at the SEC’s website at www.sec.gov and will receive information at the appropriate time on how to obtain transaction-related documents for free from Gas Natural or its duly designated agent. This communication is not an offering document and does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval, nor shall there be any sale or exchange of securities in any jurisdiction in which such offer, solicitation or sale or exchange would be unlawful prior to the registration or qualification under the laws of such jurisdiction. The solicitation of offers to buy Gas Natural ordinary shares (including Gas Natural ordinary shares represented by Gas Natural ADSs) in the United States will only be made pursuant to a prospectus and related offering materials that Gas Natural expects to send to holders of Endesa ADSs and U.S. holders of Endesa ordinary shares. The Gas Natural ordinary shares (including Gas Natural ordinary shares represented by Gas Natural ADSs) may not be sold, nor may offers to buy be accepted, in the United States prior to the time that the registration statement becomes effective. Investors in ordinary shares of Endesa should not subscribe for any Gas Natural ordinary shares to be issued in the offer to be made by Gas Natural in Spain except on the basis of the final approved and published offer document in Spain that will contain information equivalent to that of a prospectus pursuant to Directive 2003/71/EC and Regulation (EC) No. 809/2004. These materials may contain forward-looking statements based on management’s current expectations or beliefs. These forward-looking statements may relate to, among other things: • management strategies; • synergies and cost savings; • integration of the businesses; • market position; • expected gas and electricity mix and volume increases; • planned asset disposals and capital expenditures; • net debt levels and EBITDA and earnings per share growth; • dividend policy; and • timing and benefits of the offer and the combined company. These forward-looking statements are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forwarding-looking statements, including, but not limited to, changes in regulation, the natural gas and electricity industries and economic conditions; the ability to integrate the businesses; obtaining any applicable governmental approvals and complying with any conditions related thereto; costs relating to the offer and the integration; litigation; and the effects of competition. Forward-looking statements may be identified by words such as “believes,” “expects,” “anticipates,” “projects,” “intends,” “should,” “seeks,” “estimates,” “future” or similar expressions. These statements reflect our current expectations. In light of the many risks and uncertainties surrounding these industries and the offer, you should understand that we cannot assure you that the forward-looking statements contained in these materials will be realized. You are cautioned not to put undue reliance on any forward-looking information. This communication is not for publication, release or distribution in or into or from Australia, Canada or Japan or any other jurisdiction where it would otherwise be prohibited. Disclaimer and Important Legal Information |
 1. Strategic rationale for the transaction 2. Summary of the offer for Endesa 3. Proposed resolutions |
 Strategic rationale for the transaction |
 A transforming transaction to accelerate profitable growth Global leading integrated Spanish gas and electricity company, with strong energy management capabilities Complementary, high-quality assets in fast growing markets Client-focused multinational leader with over 30 million customer accounts |
 Creation of a Spanish leader in the energy sector Electricity and gas in Spain¹ No.1 No.1 Electricity and gas in LatAm No.3 Global customer connections² No.4 Global LNG supply Global utilities – ranking by customer connections (millions)² (1) By combined customer connections, after asset disposals (2) After asset disposals. Listed companies only. Presented on consolidated basis, including gas and electricity customers. EdF is a majority state owned company Combined market positions RWE (Germany) ENEL (Italy) E.ON (Germany) GAS NATURAL ENDESA SUEZ + GdF (France) ENDESA GAS NATURAL EdF (France) 42 34 33 32 31 23 20 10 |
           • Gas and electricity distribution and supply • Electricity generation • Electricity generation • Regasification plant Source: Endesa 2005 Annual report and Gas Natural. After assets disposals • Gas distribution and supply • Electricity generation • Gas and electricity distribution and supply • Electricity generation • Electricity generation • Electricity generation • Gas infrastructure • Gas infrastructure and projects • Gas/LNG contracts • LNG fleet An energy leader in high-growth markets Puerto Rico LatAm Contracts/Fleet Portugal Italy Spain Algeria Morocco |
 Combined management of clients and networks More flexible and competitive gas procurement More balanced and competitive generation portfolio Attractive business mix and investment profile Gas and electricity convergence Sizeable synergies An attractive project from a strategic, industrial and financial perspective |
 Gas and power convergence in Spain CCGT Coal 15% Nuclear 19% Fuel 4% Renewables + hydro 28% Coal 30% Nuclear 22% 26% Fuel 4% Domestic Industrial 2005 2011 Historical data Gas 33% Gas 18% CAGR 6-7% 2002 2004 2006 2008 2010 100 200 300 400 500 CAGR 16% 2003 2005 2007 2009 2011 Source: National Energy Plan 2002–2011 and Gas Natural analysis Total expected gas demand Sources of electricity generation (production)¹ Renewables + hydro Source: Red Eléctrica: “Avance del informe 2005 sobre el sistema eléctrico español” and Gas and Electricity sectors planification. Ministry of Industry, 2002 (1) Mainland generation including cogeneration and renewables TWh |
 More flexible and competitive gas procurement Source: Wood Mackenzie (1) Repsol YPF–Gas Natural LNG, S.L’s position. Up + Midstream joint venture between GAS NATURAL and Repsol YPF GAS NATURAL+ Endesa would be the 3rd largest LNG company globally Aprox. 2/3 of gas contracted by GAS NATURAL + Endesa will be LNG 5 10 15 20 25 LNG (mmtpa) |
 More balanced and competitive generation portfolio GAS NATURAL + Endesa post disposals¹ Endesa Source: REE data and GAS NATURAL estimates. Mainland installed capacity (1) The range refers to potential divestment scenarios: 1,200MW CCGT and/or Hydro (2) Includes Endesa, GAS NATURAL, Iberdrola, HidroCantábrico, Unión Fenosa and Viesgo 2006 combined generation mix (estimate) 28% 27% 18% 12% 9% 6% 16% 25-28% 19% 21-23% 13% 4% 18% 27% 12% 22% 13% 8% Coal Hydro Nuclear CCGT Renewables Fuel Generation mix in Spain² |
             Combined management of clients and networks There are many examples in Europe New Group ~ 40% Other ~ 60% New Group ~ 60% Other ~ 40% Gas distribution¹ Electricity distribution¹ GAS NATURAL + Endesa would be a leader in gas and electricity (1) Market share in Spain by number of customer connections, after asset disposals set by the Council of Ministers and the conditions set by the CNE Holland Nuon, Essent United Kingdom SSE Belgium Suez Spain Endesa HidroCantábrico Italy Enel, municipalities Austria PVN, EVN, ESTAG Germany E.ON, RWE, EnBW Denmark Dong |
 Sizeable synergies ~85 ~175 ~90 ~350 ~70 Source: Boston Consulting Group (1) Annual synergies. Synergies are estimated to be reachable in 2008 ~30 100 200 300 400 500 Distribution synergies resulting from networks overlap will be reinvested to improve quality of service of GAS NATURAL + Endesa Synergies not included in our base case Euro million |
 Attractive business mix and investment profile EBITDA 2009¹ (estimate) Source: GAS NATURAL estimates (1) GAS NATURAL/Endesa 2009 pro-forma EBITDA estimate has been calculated under IFRS Investments 2006-2009 (estimate) LatAm 32% Generation 29% Other 3% Up + midstream 5% Electricity distribution 16% Gas distribution 8% Europe 7% GAS NATURAL + Endesa would have a balanced and diversified EBITDA GAS NATURAL + Endesa expects to invest ~ €17.5 bn in organic growth until 2009 Up + midstream 7% Europe 12% LatAm 18% Generation 36% Distribution 27% |
 Positive financial impact (1) Company estimates based on IBES EPS projections of €1.87 (2006), €1.92 (2007), €2.32 (2008) and a long-term growth rate of 6.8% for Endesa. Based on IBES EPS projections of €1.61 (2006), €1.75 (2007), €2.12 (2008) and a long term growth rate of 5.0% (2) After planned disposals (3) Assuming Endesa’s shareholders reinvest cash received in GAS NATURAL shares at September 2nd 2005 price and assuming no adverse tax consequences of the sale of the Endesa’s shares Very attractive transaction for the shareholders³ of the New Group Evolution of earnings per share (EPS) (estimate) 1.5 3 2006 2007 2008 2009 New Group Gas Natural Endesa EPS 1,2 (euro) GAS NATURAL + Endesa will maintain its “A” credit rating target |
 Attractive dividend policy The New Group will adopt an attractive dividend policy¹, consistent with the “A” credit rating target Additionally, all future capital gains resulting from the sale of non-energy assets will be distributed as dividends Payout of 52-55% in 2008 DPS increase by a minimum of 15% per annum for the 2006-2009 period (1) Subject to shareholder approval and any other legal requirements |
 Multi-product offer in Spain Transaction fully in line with GAS NATURAL’s commitment to shareholders Enhanced multi-product opportunities in liberalised markets, specially dual fuel Gas supply with a equity gas position Electricity business Gas distribution Overlapping gas and electricity in key distribution areas New Group becomes a market leader in electricity generation New growth opportunities in LNG markets GAS NATURAL’s objectives Transaction impact Leading Spanish energy group across gas value chain Leadership position in international high growth potential markets Strategic Priorities |
 A transaction with benefits for consumers and the general public in the markets where we operate Strengthens Spain’s security of energy supply through a stronger position in the international markets Investment commitment that will allow the improvement of the quality of power supply to clients Transfer of synergies arising from the distribution overlap to consumers, which will generate savings for clients Improvement of the sector’s competition situation in Spain and contribution to the liberalisation of one of the most developed energy markets in Europe |
 Izmir Security of supply in Spain Brindisi Cartagena Bilbao Huelva Lisboa Madrid Athens Fos-sur-Mer La Spezia Córdoba Ferrol Montoir Paris London Dublin Brugge Brussels Rome Rovigo Krk Marmara Ereglisi Bucharest Belgrade Sophia Vienna Prague Berlin Wilhelmshaven Copenhagen Stockholm Oslo Karsto Kollsnes Berne Helsinki St Petersburg Barcelona Valencia Current gas pipeline Planned or under construction gas pipeline Gas flow direction LNG plant in operation LNG plant planned / under construction Gas procurement in Spain European gas network Source: CNE natural gas monthly statistical bulletin, February 2006 European markets supplied mainly through piped gas from Russia and the Northern Sea. Spanish market mainly supplied by LNG from the north of Africa and Middle East. Limited connection capacity by gas pipeline with the rest of Europe. Algeria 42% Persian Gulf 20% Nigeria 15% Egypt 10% Norway 6% Other 7% LNG 66% NG 34% |
 Investments to improve quality of service Expected investments by GAS NATURAL + Endesa in Spain (estimate 2006-2009) ~4,700 ~6,300 ~140 >11,000 Source: GAS NATURAL estimates (1) Up to 70 million euro per year estimated for 2008 and 2009. Total investment of c.€17.5 bn through 2009. Over 60% earmarked to improve distribution and generation in Spain. Transfer of synergies arising from distribution network overlap to clients through reinvestment. Million euro Benefits for consumers |
 Competitive situation on the European electricity market 2 4 6 8 10 12 14 16 Euro c./KWh Source: Eurostat, Domestic tariffs on 1st of July 2005, excluding taxes Comparison of European electricity tariffs |
 Summary of the offer for Endesa |
 Transaction details Tender offer for 100% of the share capital of Endesa. 7.34 euro in cash and 0.569 GAS NATURAL shares for each Endesa share. Offer consideration: 65.5% in shares and y 34.5% in cash¹. Capital increase of a maximum of 602 million GAS NATURAL’s shares². The offer values each Endesa share at 21.30 euro¹. The offer is conditioned on reaching a minimum 75% of Endesa and on the removal of existing limitations in the by-laws of Endesa (e.g. the 10% voting right limit). (1) Based on Gas Natural’s share price of €24.53 as of 02 September 2005 (last closing day, pre-announcement) (2) Assuming 100% acceptance Terms Conditions |
 Capital increase Issuance of 602,429,955 new common shares (par value of one euro each) to constitute the stock component of the consideration offered in the tender offer for Endesa. Subject to the success of the offer for Endesa. Will depend on the final level of acceptances of the offer for Endesa. In-kind contribution will be the Endesa shares tendered by Endesa shareholders who accept the offer by Gas Natural. The issue price will be determined by the Board of Directors at the time the capital increase is executed: Minimum price: 12.055 euros/share (net book value of the GAS NATURAL shares¹). Maximum price: 24.53 euros/share (closing share price of the Gas Natural shares on September 2, 2005). May not exceed by more than 20%, the difference between the total value assigned to the Endesa shares² by the independent expert (Bolsa de Barcelona) and the total cash consideration offered. Elimination of the preferential subscription right of the existing shareholders of the Company with respect to the capital increase due to the nature of the transaction causing the increase, as justified by Audihispana, acting as independent expert. (1) As per the consolidated audited financial statements as of 30/10/2005 (2) 20.89 euros/share, theweighted average price on 21/11/2005 (the day before the request for the independent expert role) and theweighted average of the three months prior to the day after such date |
 Unique opportunity to participate in a Spanish integrated gas and electricity project Free float 63.1% La Caixa 14.7% Repsol YPF 13.2% Caja Madrid 5.7% Other² 3.4% GAS NATURAL + Endesa shareholder structure after the offer¹ Endesa shareholders 57% GAS NATURAL shareholders 43% Creation of a Spanish integrated energy leader. Clear strategic rationale for the combination, based on the gas and power convergence. Sizeable synergies. Attractive dividend policy. Benefits for consumers and the general public. (1) Assuming 100% acceptance (2) Includes Hisusa and Caixa Catalunya, considered as strategic/long term investors |
 All the regulatory and administrative hurdles have been passed Spanish antitrust authorities Regulated activities (Function XIV): November 2005 National Energy Commission The EC confirmed that the jurisdiction on competition matters belonged to Spain: November 2005 European antitrust authorities Golden Share: December 2005 Secretary General of Energy The combination GAS NATURAL–Endesa was approved by the Council of Ministers: February 2006 Spanish offer/prospectus approved: February 2006 CNMV US prospectus (F-4) declared effective: March 2006 SEC (USA) Notes: The offer and therefore the processing of any action related to the offer, and the performance of the agreement between Gas Natural and Iberdrola are currently suspended, following the injunction granted by the Madrid Mercantile Court Nº3. |
 E.ON competing bid 27.50 euros per share, in cash. (1) Source: CNMV’s press release on the key dates and deadlines for the tender offers on Endesa, 24th March 2006 Terms Conditions Minimum of 50.01% acceptance. Changes in the by-laws. CNMV’s clarification¹ Deadline for competing offers ended on the 5th of April. Impact of the injunction on the GAS NATURAL offer: The CNMV will continue to review E.ON’s offer. Suspension of the “sealed envelopes” process for all offers. Extension of the acceptance periods to make all offers end on the same day. On 21st February E.ON announced a competing bid for Endesa |
 GAS NATURAL has an excellent track record… ... in the gas business1 ... in the electricity business2 Clients 2000-2005: +3.2 millions (+46%) Network Kilometres 2000-2005: +25,947 (+35%) CCGTs today: 2,800 MW CCGT target for 2008: 4,800 MW Production 2002-2005: +6.8 TWh (+329%) (1) Global business (2) In Spain |
 … meeting the objectives announced in the Strategic Plan EBITDA and Net Income (million euro) 1,2 Dividend per share (euro)³ CAGR: +18% (1) 2003 under Spanish GAAP. 2004 and 2005 under IFRS. Source: Annual Reports and Results presentation 2005 (2) 2005 data pending approval of the annual accounts by the GAS NATURAL General Shareholder Meeting (3) The year represents the fiscal year againstwhich results the dividend is declared. 2005 is an estimate pending the approval of the annual accounts by GAS NATURAL’s General Shareholder Meeting EBITDA CAGR: +12% 1,202 568 1,335 642 1,519 749 2003 2004 2005 0.60 0.71 0.84 2003 2004 2005 Net Income CAGR: +15% |
 Proposed resolutions |
 First resolution Capital increase. Issuance of 602,429,955 new common shares, having a par value of 1 euro each. Issuance premium to be determined, pursuant to Article 159.1.c) of the Law of Corporations (Ley de Sociedades Anónimas), by the Board of Directors, at the time the capital increase is executed. The equivalent value of the increase will be in-kind contributions consisting of the shares of Endesa, whose holders accept the OPA. The increase will be implemented with the total elimination of the preferential subscription right and express allowance for the possibility of partial subscription. |
 Second resolution Request to be made to the competent national and international agencies to admit the new shares to be traded on the Stock Exchanges of Madrid, Barcelona, Bilbao and Valencia. Inclusion in the Stock Exchange Interconnection System (Continuous Market). Shares of Gas Natural SDG, S.A. to be traded, by means of ADSs, on the New York Stock Exchange. |
 Third resolution Delegation, pursuant to article 153.1 a) of the Law of Corporations (Ley de Sociedades Anónimas), to the Board of Directors, of the powers necessary to determine the conditions of the increase in all aspects not provided by the General Shareholders' Meeting. Determination of the amount of the share premium. Final implementation of the capital increase. Amendment of Article 5 and first paragraph of Article 6 of the bylaws to conform to the new share capital figure. Issuance of any public and private documents that may be necessary. |
 Fourth resolution Ratification and appointment D. José Arcas Romeu as Director, for a period of three years. |
 Fifth resolution Authorization to the Board of Directors to interpret, correct, supplement, execute and implement the resolutions adopted by the General Shareholders Meeting, and grant of powers for purposes of elevating such resolutions to a public instrument. |
 Extraordinary General Shareholders Meeting 7 April 2006 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| GAS NATURAL SDG, S.A. | ||||||
| Date: April 7, 2006 | By: | /s/ Carlos J. Álvarez Fernández | ||||
| Name: Carlos J. Álvarez Fernández | ||||||
| Title: Chief Financial Officer | ||||||