E.ON Reported to Have Selected Purchaser for Open Grid Europe

German utility E.On is closing in on the sale of gas distribution network Open Grid Europe.

A consortium led by Macquarie’s infrastructure funds is reportedly to have been selected as the winning bidder to purchase Germany’s largest gas distribution network, in a deal valued at around EUR 3.1 Billion.

The Abu Dhabi Investment Authority and reinsurer Munich Re, are thought to be part of the Australian bank led group purchasing Open Grid Europe, which operates a 12,000 km pipeline network in Germany linking Eastern and Western Europe.

The disposition is a key part of the utility's plans to overhaul of its business due to financial pressures stemming in part from Germany's decision to abandon nuclear power.  E.ON is earmarking proceeds of the sale to reduce debt and for reinvestment in emerging markets in a move to reduce dependence on European countries.

In December 2010 , RWE AG, sold its gas transmission grid unit Thyssengas GmbH to infrastructure funds managed by Macquarie for proceeds estimated at EUR500 million. Thyssengas transports almost 10 billion cubic meters of natural gas annually through a 4,100-kilometer pipeline network.