Statkraft and E.ON to enter into € 4.4 billion swap
12.10.2007 08.00 | pressrelease
Statkraft AS and E.ON AG have today signed a letter of intent to swap Statkraft’s shares in E.ON Sverige AB (44.6 %) in exchange for flexible power production assets and shares in E.ON AG. The total value of the asset swap is € 4.4 billion. A final agreement is expected to be signed during the first quarter of 2008.
“Statkraft will strengthen its position as a leading player and become the largest generator of renewable energy in Europe. We will also strengthen our position as a flexible and environment-friendly energy provider in our core markets, particularly in Sweden and Germany”, says CEO Bård Mikkelsen.
The two companies will proceed with the intention of swapping Statkraft’s current shareholding in E.ON Sverige AB with 1/3 of E.ON Sverige’s hydropower assets, shares in E.ON AG and flexible gas power, hydropower and district heating assets in Europe, mainly in Germany. The assets included in the swap have an annual production around 7-8 TWh and include:
- Swedish hydropower plants (934 MW), with an annual average production of approximately 4.2 TWh
- Hydro pump storage facility (220 MW) and 10 run-of-river hydropower stations (42 MW) in Germany
- Two gas-fired power plants (700 MW) in Germany, with corresponding gas contracts, as well as gas storage capacity of up to 100 mill sm3/year
- A 10 year power purchase agreement in Germany, in excess of 100 MW
- Hydropower installation in United Kingdom (56 MW)
- District heating plants in Sweden and Poland
E.ON Sverige is today owned 55.3 per cent by E.ON and 44.6 per cent by Statkraft. A transaction as proposed will transform Statkraft’s high value creation in E.ON Sverige into strategic core assets for further growth.
Shares in E.ON are expected to constitute a substantial part of the transaction, representing more than two per cent ownership in the company. This will make Statkraft one of the five largest owners in E.ON. The exact amount of shares in E.ON and other share-related issues remain to be detailed.
“We are delighted at the prospect of becoming a significant owner in E.ON, transforming our investments in a subsidiary of E.ON to the listed company. At the same time, this new structure will give us a position with excellent opportunities for growth. We believe the valuation of E.ON Sverige demonstrates our joint success in developing this investment over the last eleven years”, says Bård Mikkelsen, CEO of Statkraft.
The deal is expected to be completed in the second or third quarter of 2008, and must be approved by the relevant authorities and the Board of Directors of both companies.
The Statkraft Group is a leading player in Europe within renewable energy. The Group generates hydropower, wind power and district heating and constructs gas power plants in Norway and Germany. Statkraft is a major player on the European energy exchanges. In Norway the company supplies electricity and heat to around 600,000 customers through its shareholdings in other companies. In 2006 Statkraft recorded a profit after tax of NOK 6.3 billion, and employed more than 2,100 employees in nine countries. The world needs pure energy. Statkraft works to deliver this every day.