Endesa Launches a Tender Offer for 100% of the Brazilian Distribution Company CERJ.

Business Editors

NEW YORK--(BUSINESS WIRE)--May 31, 2000

-- The offer, which has been communicated to the stock exchange authorities, is
made for 100% of the company's share capital at the price of R$0.73 per 1,000
shares, resulting in a premium of 23.7% over yesterday's closing price at the
Sao Paulo Stock Exchange.

-- The aim of the transaction is to increase and consolidate the current
shareholding of Endesa and its affiliates in CERJ. This will enable CERJ to
continue to increase its quality and service.

-- This transaction falls within the strategic framework of the Genesis Project
on the optimisation of Endesa's asset portfolio in Latin America, evidencing
the company's interest in increasing its presence in the Brazilian market.

-- CERJ distributes electricity in a large portion of Rio de Janeiro State,
serving a population of around five million inhabitants and a customer base of
1.6 million.

Endesa Internacional, SA, the affiliate which groups Endesa's international investments, communicates its intention to launch a tender offer for 100% of the share capital of the Brazilian distribution company Companhia de Eletricidade do Rio de Janeiro (CERJ).

The offer has been communicated to the Brazilian and Spanish stock exchange authorities and is made at a price of R$0.73 for every 1,000 shares, representing a premium of 23.7% over yesterday's closing price at the Bolsa de Valores de Sao Paulo (BOVESPA).

The transaction, which will have an immediate positive impact on Endesa's earnings per share, also aims to increase and consolidate the current shareholding of Endesa and its affiliates in CERJ, which will benefit from the Group's technical and financial capabilities, therefore allowing the progress in the investment pan geared towards the improvement in its service and quality levels.

On the other hand, this transaction falls within the strategic framework of the Genesis Project on the optimisation of Endesa's Latin American asset portfolio and contributes to materialise its interest in enhancing its presence in the Brazilian market.

CERJ's share capital is made up of a total of 1,547,807 million shares. Endesa Internacional, SA currently owns 16%, both directly and indirectly. The Enersis Group - 64% owned by Endesa - owns an additional 44.3%. The remaining share capital is owned by the Portuguese EDP (23%) and other minority shareholders (17%).

CERJ distributes electricity in a large portion of Rio de Janeiro State, serving a population of close to 5 million inhabitants in 66 municipalities covering an area of 31,741 square kilometres. At the end of 1999 CERJ's customer base was 1.6 million customers (7% higher than 1998), 89.8% of whom were residential.

Dresdner Kleinwort Benson has acted as financial advisor for this transaction. Dresdner Bank Brasil-Banco Multiple will act as co-ordinator of the public offer.