April 23 (Renewables Now) - German energy company RWE AG (ETR:RWE) said Friday it has reached a contractual agreement to transfer its 76.8% interest in Innogy SE (ETR:IGY) to E.on SE (ETR:EOAN) as part of the previously announced major asset swap deal.
As disclosed in mid-March, the transfer of the Innogy stake is one piece of a far-reaching exchange of assets, as part of which RWE will get substantially all of E.on's renewables activities, Innogy's renewables business and a 16.67% stake in E.on. In addition, RWE will keep Innogy’s gas storage business, a stake in Austrian utility Kelag, and get minority stakes in two RWE-operated nuclear power plants.
“We will continue to pursue this transaction as planned and implement it with resolve,” RWE said Friday. The announcement came shortly after Innogy said third parties had expressed interest in buying certain business activities in the Czech Republic, and in the Renewables, Retail, and Grid & Infrastructure divisions.
According to reports, Macquarie Group Ltd (ASX: MQG) is interested in certain Innogy assets.
“As innogy’s main shareholder, RWE believes that value can be maximised if two clearly focused companies play a significant role in the international energy markets in the future,” the company said, adding that “breaking up and selling innogy in pieces is not an alternative for RWE.”
The transaction with E.on will allow the previously vertically integrated German energy utilities to focus on networks and customer solutions on the one hand, and on diversified generation on the other. Once it is completed, RWE will have about 8 GW of generation capacity from offshore and onshore wind, as well as hydro and photovoltaics (PV) assets. This will make it the number-three renewables player in Europe and number two in terms of wind power, it said in March. In addition, it will operate its conventional power plants.
Innogy’s Executive Board has resolved to allow due diligence regarding its Czech business and to provide selected information on the respective business activities. This, RWE explained, is the board’s duty under German stock corporation law.