RWE starts auction for German grid

City A.M. Reporter
GERMANY’S RWE, Europe’s fifth-largest utility, said it has launched an auction process for the sale of its gas transmission network Thyssengas.

RWE, which has to sell the business by March 2011 after settling an EU antitrust investigation, said it was expecting expressions of interest for the grid by 25 August.

“We contacted potential investors from Germany and abroad last week. We hope to get answers from serious investors by 25 August and finish the process by the end of the year,” an RWE spokeswoman said late yesterday.

One source who declined to be named, but who is familiar with the deal, said Thyssengas is estimated to have a regulated asset base of around €500m.

A consortium of Bavarian gas company Bayerngas and local utilities Stadtwerke Dortmund, Dortmunder Energie und Wasser, Stadtwerke Bochum, Munster and Gelsenwasser is interested in bidding for Thyssengas, spokespeople for it said.

The sale could attract financial investors such as infrastructure funds, though German gas infrastructure deals have recently struggled.

RWE shares closed down 2.3 per cent to €54.2, in line with the German blue-chip DAX index, which closed down 2.1 per cent.