Iberdrola : announces sale of wind assets in Italy for €193.7 million

Iberdrola has informed the Comisión Nacional del Mercado de Valores(CNMV), Spain's stock exchange commission, of the sale of wind energy assets in Italy, grouped in the companies SER S.P.A. -100%- and SER 1 S.P.A. -4%- (with the remaining 96% belonging to the former).

Under the agreement, Iberdrola sells to CEF 3 Wind Energy S.P.A. five wind farms, with 245 megawatts (MW) total installed capacity, namely Lago Arancio, Rocca Ficuzza, Nebrodi and Alcántara, in Sicily, and S. Agata, in the province of Foggia. All of the facilities were commissioned between 2009 and 2011.

The operation is valued at €193.7 million and cash payment will be structured in three phases: €1 million already received, €84 million payable in November and €108.7 million to be paid by 31st May 2017.

CEF 3 Wind Energy S.P.A. will also take over the debt owned by SER S.P.A. and SER 1 S.P.A., which at the close of 2015 amounted to €222.3 million.

Iberdrola's decision to divest these Italian assets responds to the company's strategy of focusing activity and investments in the United Kingdom, United States, Mexico, Brazil and Spain.

Within this strategy, the company maintains a strong commitment to clean energy. Of the €24 billion that Iberdrola plans to invest between 2016-2020, €7.9 billion (or 33% of total) will be dedicated to the renewables business.

Of that amount, €4.23 billion will go to onshore wind projects and €3.46 billion to offshore wind technology, pioneered by Iberdrola. 75% of tne new facilities are being built while the remaining 25% are at advanced development stages.

DISCLAIMER

This presentation has been prepared exclusively for information purposes by Iberdrola, S.A. in connection with the sale of SER and SER1 and for presentations to the media, investors and analysts.

As a consequence thereof, this document may not be disclosed, released, published or relied, nor used by any other person or entity, for any other reason without the express and prior written consent of Iberdrola, S.A.

Iberdrola, S.A. does not assume liability for this document if it is used with a purpose other than the above.

The information and any opinions or statements made in this document have not been verified by independent third parties; therefore, no express or implied warranty is made as to the impartiality, accuracy, completeness or correctness of the information or the opinions or statements expressed herein. This document includes certain statements, estimates and projections prepared for illustration purposes only. Such statements, estimates and projections reflect various subjective judgments and assumptions made by Iberdrola, S.A. There can be no assurance that such projected result are attainable or will be realized or that such events or developments should occur.

No representations or warranties, express or implied, are made as to the accuracy, completeness or fairness of such statements, estimates or projections. Users of this document are to conduct their own independent investigation to confirm facts, estimates and projections as part of their due diligence process.

Neither Iberdrola, S.A. nor its subsidiaries or other companies of the Iberdrola Group or its affiliates assume liability of any kind, whether for negligence or any other reason, for any damage or loss arising from any use of this document or its contents. 14 15 June 2016.

Neither this document nor any part of it constitutes a contract, nor may it be used for incorporation into or construction of any contract or any other type of agreement.

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IMPORTANT INFORMATION

This document does not constitute an offer or invitation to purchase or subscribe shares, in accordance with the provisions of the Spanish Securities Market Law (Law 24/1988, of July 28, as amended and restated from time to time), Royal Decree-Law 5/2005, of March 11, and/or Royal Decree 1310/2005, of November 4, and its implementing regulations.

In addition, this document does not constitute an offer of purchase, sale or exchange, nor a request for an offer of purchase, sale or exchange of securities, nor a request for any vote or approval in any other jurisdiction.

FORWARD-LOOKING STATEMENTS

This communication contains forward-looking information and statements about Iberdrola S.A. and/or its subsidiary/ies. Forward-looking statements are statements that are not historical facts. These statements include financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future operations, products and services, and statements regarding future performance. Forward-looking statements 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. Except as required by applicable law, Iberdrola, S.A. does not undertake any obligation to update any forward-looking information or statements.

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