IBERDROLA today closed the largest bond swap ever carried out by a European company with an operation launched on March 27 which involved the issue of €1 billion of 6-1/2 year bonds (due October 2018). The bonds, with a spread of 240 basis points over midswaps and a 4.25% coupon, were placed with 385 investors (85% international) and nearly five times oversubscribed.

The strong demand reflected IBERDROLA’S continuing attraction to investors depsite increased volatility in the credit markets over recent weeks.  Simultaneously, repurchase orders were made through Barclays for different company bonds in circulation with short maturities.

As a result of the operation, to be disbursed and exchanged on April 11, IBERDROLA will improve its liquidity position for the next 24 months by reducing May 2013 maturities by €316.45 million and those of March 2014 by €587.6 million. Debts maturing in 2013 and 2014 thus total €2,562 million and €3,464 million, respectively.

This operation further strengthens IBERDROLA’s balance sheet, which ended 2011 at nearly €9.3 billion, enough to meet funding needs for the next two years.

It was the third by IBERDROLA so far this year, following a €400 million, 4-year bond issue in the Euromarket in January, and a 250 million, 5-year Swiss Franc bond in the Swiss market in February.

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IMPORTANT INFORMATION 

This announcement is not an offer for sale of securities in the United States, nor in any other jurisdiction. The securities referred to herein may not be sold in the United States absent registration or an exemption from registration under the US Securities Act of 1933, as amended.

FORWARD-LOOKING STATEMENTS 

This communication contains forward-looking information and statements about IBERDROLA S.A., including financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future operations, capital expenditures, synergies, products and services, and statements regarding future performance. Forward-looking statements are statements that are not historical facts and are generally identified by the words “expects,” “anticipates,” “believes,” “intends,” “estimates” and similar expressions.

Although IBERDROLA, S.A. believes that the expectations reflected in such forward-looking statements are reasonable, investors and holders of IBERDROLA, S.A. shares are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of IBERDROLA, S.A., that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include those discussed or identified in the public documents sent by IBERDROLA, S.A. to the Comisión Nacional del Mercado de Valores.

Forward-looking statements are not guarantees of future performance. They have not been reviewed by the auditors of IBERDROLA, S.A. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date they were made. All subsequent oral or written forward-looking statements attributable to IBERDROLA, S.A., or any of its members, directors, officers, employees or any persons acting on its behalf are expressly qualified in their entirety by the cautionary statement above. All forward looking statements included herein are based on information available on the date hereof. Except as required by applicable law, IBERDROLA, S.A. undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.