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GDF Pulls Out of Bidding for E.ON Assets in Italy

Posted by October 15, 2014

France's GDF Suez will not be making a binding offer for the assets German utility E.ON is planning to sell in Italy, a source close to the matter said on Wednesday.

The French energy giant, Italy's No. 3 player in terms of natural gas sales, had expressed an interest in E.ON's hydroelectric, solar and wind plants in Italy as well as its gas client portfolio, sources previously told Reuters.

"It has decided to withdraw from the race because it has other priorities at the moment," the source said.

GDF could not immediately be reached for a comment.

With more than 30 billion euros ($38 billion) in net debt and its traditional generation business under pressure from renewable energy, E.ON is mulling the sale of its country operations in Italy and Spain.

Binding offers for Italian assets are expected at the beginning of November.

Italy's biggest utility Enel is said to be interested in the German giant's Italian client portfolio as are some other regional utilities such as A2A, people familiar with the matter have said.

Sources said last month Edison, the Italian power company controlled by France's EDF, was set to enter private talks with E.ON to buy all of the German group's Italian assets.

A banking source last week said Edison was considering putting the E.ON assets into a vehicle and listing it.

Edison could not be reached for a comment.

But another source familiar with the matter said E.ON was now more interested in selling the assets in lots rather than as a single block.

E.ON, which has some 6,000 megawatts of installed power capacity in Italy, has around 900,000 gas and electricity clients and a stake in an offshore liquefied natural gas terminal in central Italy.

(1 US dollar = 0.7820 euro)

(Reporting by Giancarlo Navach and Stephen Jewkes; Editing by Luca Trogni and Mark Potter)

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