E.on sells Italian power assets to EPH

E.ON has sold its Italian coal and gas generation assets to Czech energy company Energetický a Pr?myslový Holding (EPH).

With EPH, E.ON has found a buyer for all its thermal generation activities in Italy who is fully committed to the further development and long-term future of the assets thereby helping to ensure security of supply for the country. The Prague-based company is a vertically integrated energy group with presence in various European countries.

The activities that will be sold have a total generation capacity of approximately 4,500 megawatts. They consist of an approximately 600 megawatt coal-fired power plant in Sardinia (Fiume Santo) and approximately 3,900 megawatts of gas-fired power capacity across six power plants located on the Italian mainland and in Sicily.

The transaction is subject to the approval of the European Union competition authority. The transaction is expected to close in the second quarter of 2015.

E.ON CEO Johannes Teyssen stated:

“Our conventional generation activities in Italy are high performing assets with a climate-friendly and diversified generation fleet. They are a key element of energy security in Italy and I am convinced that the new owner will continue to invest into the energy system of the country. I want to take this opportunity to thank all affected employees in Italy for the excellent work they have done as part of E.ON. We will work closely with the new owner, our trade unions and their representatives to set a successful course for the future of the assets and our employees. We continue to assess a possible divestment of our other businesses in Italy as well.”

Daniel K?etínský, CEO of EPH commented:

“We are proud to have the opportunity to continue E.ON's tradition in the conventional power generation in Italy. Our strategy is long term and development focused. We look forward working on this goal together with employees, trade unions and other stakeholders."

E.ON is currently trying to complete a €20 billion disposal program due to the fact that its market value has plunged by nearly three quarters since 2008 on the back of a sluggish European economy. As part of this restructuring plan, the German utility giant is also selling non-core assets like its operations in Italy.In early December, we reported that Enbridge Inc. purchased an 80% interest in a portfolio of two wind farms in the U.S. from E.ON. Additionally in early December, we reported that E.ON agreed to sell all of its Spanish and Portuguese businesses to Macquarie European Infrastructure Fund IV (Macquarie Group) and Wren House for an enterprise value of €2.5 billion (US$3.11 billion).