Friday, August 22, 2014

Five-billion deal for RWE subsidiary: Government approves sale of Dea … – ABC Online

Five-billion deal for RWE subsidiary: Government approves sale of Dea … – ABC Online

Friday, 08.22.2014, 13:05
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The Federal Government has approved the controversial sale of RWE -oil and gas conveying daughter Dea to an investor group led by Russian oligarch Mikhail Fridman. RWE intends to close the deal later this year. The company’s headquarters will stay loud Hamburg RWE maintained.

The confirmation followed by a group of investors LetterOne. The 5.1 billion-euro transaction is given the Ukraine crisis and the role of Moscow in the conflict as delicate. The Federal Government has in foreign trade transactions that are considered politically sensitive, a say. The competition authorities of the EU Commission had already approved the sale.

The Hamburger RWE subsidiary with approximately 1,400 employees, promotes, inter alia, in Germany, Norway, Great Britain and Egypt oil and gas and operates in Germany several underground gas storage. RWE intends to close the deal later this year. The company Hamburg remain thereby obtained, the Essen-based company assured.

share of the three gas storage in Bavaria is located on the gas reserve at around 7.5 percent

According to RWE, the share of oil is – and gas production at Dea in Germany’s primary energy consumption is only about one per cent. The proportion of the three gas storage in Bavaria on the German gas reserve is, according to RWE at around 7.5 percent. The acquisition of RWE Dea by LetterOne had been examined intensively, and there were no objections were raised, the economy ministry said in Berlin on Friday.

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The decisive factor was that it concerns an EU based investor in LetterOne and also no evidence of an unlawful circumvention were recognizable. LetterOne has its official seat in Luxembourg. “In addition, the federal government expects the acquisition project without adversely affecting the security of supply.”

RWE was pleased with the result

LetterOne manages claims to assets and investments, including telecom companies, worth a total of $ 29 billion (21.9 billion euros). Fridman, who is considered one of the richest Russians, is also the Chairman of the Board. The money for investment comes inter alia from the sale of its shares in the oil company TNK-BP to the Russian state company Rosneft for $ 55 billion in 2012

RWE was pleased with the result. “With this decision we have taken a hurdle in the sales process. We will follow the process on schedule now, “said a spokeswoman for RWE. The Essen-based company is suffering from the dramatic fall in the share price of electricity and a high debt burden of more than 30 billion euros. He needs the money to repay debt.

Dea was for many years as income pearl in the RWE Group. The oil and gas business requires but simultaneously billion investment, RWE could not afford in the current tense situation or wanted. The sale would lead to a “significant relief of future capital expenditure” and so bar a “significant contribution to strengthening the financial strength”, RWE CEO Peter Terium had in 2013 argued in the announcement of the sale plans.


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