IBERDROLA completed a €750 million issue of 6-year bonds on the euro market today.  Given the current favourable market conditions for groups such as IBERDROLA, the initial amount was raised by €250 million.

This issue was approximately five times oversubscribed, drawing orders of €4.2 billion, and was placed among over 300 investors from 30 different countries in record time.

The success of this issue highlights market interest in IBERDROLA paper and the company’s ability to raise funds in different markets. This is reflected in the positive trend of its risk indicator (5Y CDS), which is trading below 125 basis points.

The spread was finally 143 basis points at midswap,  lower than the previously established 145/150 basis points. The coupon was 4.625%. The lead managers were Barclays Capital, Credit Agricole CIB, JPMorgan Chase & Co., Lloyds Banking Group Plc, Royal Bank of Scotland Group Plc and Santander, S.A.

This issue, which will enable IBERDROLA to meet future requirements, follows others carried out in the last two years in the capital markets and the bond exchange in September 2010, which raised around €9.5 billion.

Through this placement, the Group aims to strengthen its liquidity position , which amounted to €10.6 billion at 2010 year end, enabling it to cover its financing needs until mid-2012.

IBERDROLA has also reduced its gearing ratio from 46.2% in 2009 to 43.3% at 2010 year end (excluding the impact of the tariff deficit).

IMPORTANT INFORMATION

This communication does not constitute an offer of purchase, sale or exchange or a request for an offer of purchase, sale or exchange of values. The shares of Iberdrola S.A. cannot be offered or sold in the United States, except if this is carried out through a declaration of effective notification of what is laid out in the Securities Act or under the protection of a valid exemption of the need for notification.