EnBW sells minority stake in TransnetBW for $1.1 billion

By Christoph Steitz

FRANKFURT (Reuters) -German utility EnBW has sold around a quarter of its high-voltage transmission grid TransnetBW to a savings banks-led consortium for around 1 billion euros ($1.1 billion), the group said on Friday.

The sale of the minority stake values TransnetBW as a whole at around 4 billion euros, highlighting the continued attractiveness of regulated power grids despite a recent rise in interest rates.

Shares in EnBW rose 1.6%.

The buyer of the 24.95% stake is Suedwest Konsortium Holding GmbH, led by the SV Sparkassen Versicherung, and includes more than 30 banks, insurance firms and companies in the German state of Baden-Wuerttemberg, the firm said.

EnBW, which announced plans to partially divest TransnetBW last year, said it expects the deal to be approved by regulatory bodies during the third quarter of the current year, adding it would remain the subsidiary's majority owner.

"I see this as a historic decision on the part of EnBW," said Peter Schneider, president of the Savings Bank Association of Baden-Wuerttemberg, the German state where EnBW is based.

"The Russian war of aggression against Ukraine has brought home to all of us the importance of secure energy supplies. A key part of this is the electricity transmission grid."

German state lender KfW also has an option to buy a 24.95% stake in TransnetBW and EnBW said this can be exercised in the coming weeks on the same terms. Sources told Reuters in February that KfW intends to exercise its option.

Berlin's plans to take a stake in TransnetBW reflect broader concerns about the ownership structure of critical energy infrastructure, with Germany also planning to take over the local division of Dutch grid operator TenneT.

($1 = 0.9084 euros)

(Reporting by Christoph Steitz, writing by Linda Pasquini; editing by Matthias Williams, Kirsten Donovan)