e-on to Acquire Innogy for €43m deal with RWE

The German utility company E-on, is to acquire Innogy, the renewable energy business from its controlling shareholder RWE. Under the deal E-on will focus on providing energy networks and services to retail customers, while RWE will acquire E-on and Innogy’s renewables business and take a 16.7 per cent stake in E-on. E-on will acquire RWE’s 76.8 per cent stake in Innogy by offering a combination of newly issued shares and assets.

Additionally, RWE will receive E-on’s minority stakes in two RWE-operated nuclear plants, Innogy’s gas storage business and its stakes in the Austrian energy supplier Kelag. In return RWE will pay E-on €1.5bn in cash. E-on will make a cash offer worth €40 a share inclusive of future dividend payments to investors in Innogy, which has spun out of RWE in 2016, worth over €5bn. The deal values Innogy equity to €22bn. Shares in Innogy closed last week at €34.53 giving it a market value of €19.1bn.

Shares in E-on are up over 20 per cent over the past year giving it a market value of €18.6bn. RWE has climbed 23 per cent in the same period and is worth €11bn.