Statkraft Sells EON Stake for $1.5 Billion to Boost Capital

Statkraft AS, Norway’s biggest utility, said it has sold its 4.2 percent stake in EON SE, Germany’s largest power producer, for 8.5 billion kroner ($1.5 billion) to boost its investment capital.

“The main objectives for the strengthening of the capital structure are preserving a sensible balance between solidity and expansion ability, as well as maintaining the current credit rating,” Oslo-based Statkraft said today in a statement.

Statkraft acquired the stake in 2008 through a 4.5 billion-euro ($5.9 billion) swap deal under which it ceded its 45 percent stake in Swedish venture EON Sverige to the German company in exchange for power assets in Sweden, Germany and the U.K., as well as EON stock valued at 2.2 billion euros at the time, according to Statkraft.

While the shares have declined since the swap deal, and lost 21 percent in the last six months, the company’s investment in Sydkraft, which later became EON Sverige, had been a “success,” returning about 45 billion kroner in assets and cash from an initial 15 billion-kroner investment in 1996, Statkraft spokesman Knut Fjerdingstad said by phone.

Holding cash rather than stock offers more “flexibility” as the company will continue to invest in hydropower, wind power and district heating, he said.

Of the 83.4 million shares Statkraft held in EON, 23.4 million were sold in the first quarter for 2.3 billion kroner and the rest in the second quarter, he said.

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