German utility RWE on Sunday said it has reached an agreement in principle to sell a 76.8 percent stake in its renewables arm Innogy to German rival E.On.
Innogy is currently valued at around 19 billion euros ($23.38 billion).
Through the takeover, which includes an asset swap deal, E.ON will focus its business on energy networks and customer solutions, while RWE will take on the renewables businesses of both E.ON and RWE.
E.On will make a voluntary cash takeover for RWE’s Innogy stake valued at 40.00 euros ($49.22) per share, E.On said in a statement on Sunday. Innogy shares closed at 34.53 euros on Friday.
This price includes an offer of 36.76 euros per share plus assumed dividends of Innogy SE for the fiscal years 2017 and 2018 in the total aggregate amount of 3.24 euros per share, E.On said. RWE will not participate in the offer.
As part of the deal, E.On will make a 20 percent capital increase so that RWE can buy a 16.67 stake in E.ON SE. E.ON SE will issue shares from authorized capital while RWE will make a cash payment to E.ON of 1.5 billion euros, E.On said.
E.ON also agreed to transfer most of its renewables business to RWE including minority interests currently held by E.ON’s subsidiary PreussenElektra in the RWE-operated nuclear power plants Emsland and Gundremmingen.
RWE in turn, will receive the entire Innogy renewables business, the innogy gas storage business, and innogy’s stakes in the Austrian energy supplier Kelag, E.On said.
The transfer of businesses and participations would be conducted with economic effect as of January 1, 2018, E.On said.
Innogy, a network, renewable and retail energy utility has been in turmoil ever since the resignation of Chief Executive Peter Terium in December and after its Chief Financial Officer Bernhard Guenther was subjected to an acid attack.