Eon takeover of Innogy / RWE asset swap

Overview:

• German utility Eon has reached an agreement to acquire German energy company Innogy from its majority shareholder RWE through a deal involving cash, share issues and asset swaps that will see both RWE and and Eon change the focus of their businesses.
• Under the share issue and asset swap element of the deal, RWE will retain the renewable energy portion of Innogy in addition to securing Eon's renewables business. Eon, meanwhile, will take over the regulated energy network portion of Innogy and its customer service business. The transaction will also see RWE secure a 16.7% stake in Eon (created through a capital increase) and the company's gas storage business, in addition to other physical infrastructure assets. 
• The cash element of the transaction requires Eon to make a €40 a share offer to Innogy's minority shareholders, equating to around €5 billion, while Eon would receive €1.5 billion from RWE.

Ben Naylor - Regional editor