German energy companies RWE and Eon have reached an agreement that will see RWE acquire Eon’s renewables business innogy.
Following completion of the transaction, RWE would combine ownership of the renewables businesses of Eon and innogy, creating a leading European utility for renewables with a diversified portfolio of renewable and conventional generation assets.
The somewhat complex deal involving shares and asset swaps will see RWE take over Eon’s renewables business while Eon gets the retail and network businesses of both companies. It will also mean that RWE will end up with a large stake in Eon. The deal requires the approval of the board of directors at Eon and RWE.
Under the agreement, Eon would receive RWE’s 76.8% stake in innogy in return for granting RWE an effective participation of 16.67% in Eon SE. The shares would be issued by way of a 20% capital increase against a contribution in kind from existing authorised capital. Eon would transfer to RWE most of its renewables business and minority interests currently held by Eon’s subsidiary PreussenElektra in the RWE-operated nuclear power plants Emsland and Gundremmingen.
RWE would end up with the entire innogy renewables business, the innogy gas storage business and innogy’s stakes in the Austrian energy supplier Kelag.