No to MBO: construction provides stability to the company, in terms of earning and risk.

Especially
given the rapidly changing renewable energy industry and the uncertainty surrounding it, the
construction division will provide stability in the future. The recent turnaround and restructuring of
the company has impressed us and we are optimistic about the company’s future with its current
strategic goals and prospects. Investment in pure RE or construction both have downsides (high risk
& low growth prospects respectively), leaving Acciona intact is a good way to capture the benefits of
both industries. An MBO is highly unlikely since the Entrecanales family currently owns 62% of the
company, the CEO Jose Manuel Entrecanales is part of this family. The MBO serves to allow the
management to pursue their growth goals without needing the shareholders’ approval, but the
family owns the company and runs the company, so we don’t see the purpose of an MBO.

We are a (renewable energy) fund which can offer advice and expertise in this field as the company
strives to grow RE into a stable and very profitable division.

Purchase ~10% of shares from the Entrecanales family, which leaves them with a majority stake and
makes us by far the biggest financial investor, giving us some influence on the actions of the
company. We will partially use our influence to encourage further deleveraging of the company, and
partially replace the money paid out to debtholders with higher dividends which gives us attractive
returns.

Max price of $75, which is around 10% premium on the current market price. We are not prepared
to pay more since this is not a strategic M&A deal which will offer synergies, it is simply a long-term
investment. This transaction allows the Entrecanales family to cash in on their company’s recent
success, while still retaining more than 50% of the equity.

With a price of $75 and a net dividend of $3, this would amount to 4% annual return without taking
into account any capital gains. The dividend has been growing rapidly and we see the $3 as a realistic
figure to be attained within the next few years.

Potential split up of renewable energy and infrastructure in the future once RE has become a more
stable and mature division.