Austrian hydro electric company Verbund will acquire eight run-of-river hydro plants built acorss the Inn and Danube Rivers in Germany from E.ON. Renewables.
Purchase of the hydro plants will expand the company’s average annual production capacity by 2 billion kWh, equal to the electricity needs of 600,000 households per annum.
In exchange the company will transfer its 50% interest in Turkish firm Enerjisa to E.ON; Enerjisa is under a joint ownership of Verbun and Turkey-based Sabanci Holding.
A company spokeswoman had revealed that each deal is worth over €1bn ($1.3bn).
The company is also buying back 200 million kWh of hydro power generation from the Zemm-Ziller group.
Verbund CEO Wolfgang Anzengruber remarked that the company intends to focus on hydropower, majority shareholdings and the Austrian and German markets.
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By GlobalData"That is why we are taking the opportunity to expand our hydropower production in Germany, and gain more control over existing investments.
"This transaction strengthens our position as one of the leading producers of hydropower in Europe: among other things, this will raise our electricity generation from run-of-river power plants by 9% and improve our risk profile.
"In addition, it will open up further room for manoeuvre for strategic opportunities," added Anzengruber.
The transaction is expected to close in the first quarter of 2013 and requires approvals from antitrust and regulatory bodies.
