GERMAN utility E.On has started preparations for the sale of its Italian business and will soon begin the search for a buyer, four people familiar with the matter said, at a price likely to be about €3bn (£2.5bn).
Burdened by a massive expansion of renewable energy capacity, falling wholesale prices and tepid energy demand in Europe, E.On embarked on a disposal plan that has already raised close to its target of about €20bn.
“Goldman Sachs has been contacted to look into things (regarding the Italian sale), but it’s early days yet,” one of the sources said.
A banker working with a potential buyer told Reuters that he expects an auction to begin as early as January or February.
Apart from the Italian plan, E.On aims to rake in at least €1.6bn through the sale of German business E.On Mitte and its stake in uranium enrichment company Urenco. E.On and peer RWE both own 16.7 per cent of Urenco, with Britain and the Netherlands holding a third each.
E.On’s Italian plans were reported by German paper Handelsblatt, which cited industry sources saying the business could be worth more than €2bn. A second source confirmed that Goldman Sachs is working on the file, adding that E.On will not sell on the cheap.
City A.M. Reporter