Italgas (OTCPK:ITGGF) said Saturday it will acquire 2i Rete Gas for 5.3B euros ($5.8B), including debt, according to media reports. The deal’s equity value is 2.06B euros, and 2i Rete Gas’s net financial debt and other liabilities was about 3.25B euros at the end of last year, the company reportedly said. The combination would be a major step in the consolidation of the Italian gas distribution sector and create a leading European player, Italgas Chief Executive Paolo Gallo was quoted as saying in a statement. Italgas will cover the merger’s costs through a bridge loan initially underwritten by JP Morgan and syndicated to a group of banks that include Banco BPM, BofA Securities, Citi, JP Morgan, Morgan Stanley, and Société Générale. Italgas will then launch a 1B euro rights issue to refinance the bridge loan to maintain its credit-rating rating profile, according to the reports. Reuters reported the gas-distribution fund F2i has a 64% stake in 2i Rete Gas, Italy’s second largest gas distributor, while Dutch pension fund APG and buyout firm Ardian hold the remaining 36% under the vehicle Finavias. Bloomberg reported Italgas would control a 155K kilometer-long network in Europe and give it control of more than half of the Italian market after the deal closes, which is expected in the first half of 2025. Sean Gallup/Getty Images News