EON Set to Announce Asset Swap Deal With Verbund Tomorrow

EON SE and Verbund AG, Germany and Austria’s biggest utilities, will announce an agreement to swap power-generation assets tomorrow, two people with knowledge of the matter said.

The agreement to exchange E.ON stations in Germany for Verbund’s stake in a Turkish power generator may be a pure asset swap or include a limited cash payment, said the people, asking not to be identified because the process is private.

EON, based in Dusseldorf, will take Verbund’s 50 percent stake in Enerjisa Enerji AS, a venture with Turkey’s Haci Omer Sabanci Holding AS, in exchange for power plants in Germany, a deal first reported in September.

Josef Nelles, a spokesman for EON, and Beate McGinn, a spokeswoman for Verbund, declined to comment on a possible agreement. Suat Ozyaprak, a spokesman for Sabanci Holding, also declined to comment.

EON wants to expand in Brazil and Turkey where energy demand is expected to grow faster than in Europe. The utility acquired an 11.7 percent stake of Brazilian billionaire Eike Batista’s MPX Energia SA and set up a power-generation joint venture earlier this year.

Enerjisa, in which Verbund bought a stake for $326.2 million in 2007, has plans to have 5,000 megawatts of power capacity in Turkey by 2015 and a 10 percent share of the power production market.

Wolfgang Anzengruber, chief executive officer of Verbund, said in September that the utility isn’t a global player and will focus on “core Europe,” according to an interview in the Kurier newspaper. “Our target area is southern Germany, northern Italy, perhaps Switzerland,” he said.

The agreement marks the second time Verbund, Europe’s fourth-biggest producer of hydropower, has taken over EON plants in Germany after buying 13 hydropower stations along the Inn River in southern Germany for more than 1 billion euros ($1.3 billion) in 2009.

Energy Producer

Enerjisa Enerji, Turkey’s second biggest non-state energy producer, was set up last year with 3.5 billion lira ($1.96 billion) of capital after a reorganization of businesses owned by Verbund and Sabanci Holding. Enerjisa, which had 3.7 billion liras of sales in 2011, has about 1,700 megawatts of generating capacity, through its production unit Enerjisa Enerji Uretim AS.

In last year’s statement, the Enerjisa Enerji Uretim unit was valued at 8.64 billion liras and Enerjisa Elektrik Dagitim AS, which operates the power grid in Turkey’s capital Ankara, at 1.16 billion liras.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE