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(Bloomberg) — German energy company RWE AG plans to raise about €4.1 billion ($4.7 billion) selling shares in order to increase its stake in one of the country’s transmission system operators — a significant step that marks the company’s increasing shift toward regulated infrastructure assets.
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The move will help RWE lift its stake in Amprion GmbH to 55%, signaling that it’s prioritizing regulated transmission assets that offer predictable returns as Europe’s electrification drive accelerates.
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“This makes the regulated grid business RWE’s third pillar, alongside investments in renewable and flexible generation,” said Chief Executive Officer Markus Krebber in a late Monday call with reporters. The earnings contribution from RWE’s regulated and contracted businesses is set to rise to over 75%, he said.
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RWE already holds a 20% stake in Amprion, which transports electricity to about 29 million people and industrial consumers across seven federal states mainly in the west of Germany.
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The company’s move highlights growing investor appetite for power grids in Europe. Last year, a consortium led by Norges Bank Investment Management agreed to invest as much as €9.5 billion in Tennet Holding BV’s German power grid in exchange for a 46% stake, with the German government later agreeing to buy a 25.1% stake. French utility Engie SA also made a multibillion-pound bet on UK electricity grids.
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RWE plans to sell about 74 million shares, split between new bearer and treasury shares, according to terms seen by Bloomberg. The holdings represent about 10% of the company.
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The Qatar Investment Authority and Norges Bank agreed to buy about €1 billion of the offering, terms show. The funds will be used to buy shares from other investors in M31, a holding company that owns most of Amprion, the terms show. The total price paid for this stake will be €3.6 billion, a press release by RWE said.
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Bloomberg News reported last week that RWE is nearing a deal to boost its stake in Amprion by buying stakes from Swiss Life and a German pension fund.
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A while back, RWE was considering selling its stake in Amprion. Krebber said on Monday a window of opportunity had opened as other shareholders were looking to sell. He added that the deal would make RWE’s portfolio more robust and diversified and provide a growth opportunity that is expected to increase earnings per share.
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Krebber added the firm is in talks with further Amprion shareholders, which could lead to more opportunities of a smaller scale.
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(Updates with comments by CEO Markus Krebber.)
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