Daniel Kretinsky plans to team up with Germany’s RAG-Stiftung foundation to make an offer for utility Steag, a move that may hand the Czech billionaire an edge over rival bidder Asterion Industrial Partners.
(Bloomberg) — Daniel Kretinsky plans to team up with Germany’s RAG-Stiftung foundation to make an offer for utility Steag, a move that may hand the Czech billionaire an edge over rival bidder Asterion Industrial Partners.
“We can confirm that the RAG-Stiftung is in advanced negotiations to form a consortium with EPH,” a RAG-Stiftung spokesperson said in an emailed statement.
A decision by Kretinsky’s energy holding company EPH to partner with RAG-Stiftung may help it secure the backing of local politicians and labor union representatives for a takeover of Steag, people with knowledge of the matter said.
RAG-Stiftung, which helped oversee Germany’s transition away from hard coal mining, has an influential board of trustees that includes finance and economic ministers, as well as the chief executive officer of Steag, Andreas Reichel.
EPH faces competition from Spanish infrastructure investor Asterion in its pursuit of Steag, which runs power plants in energy-hungry North-Rhine Westphalia in the west of Germany.
Both suitors have plans to transform the utility into a large renewables player, Bloomberg News reported previously — something that will require massive investment. EPH already controls German utility Leag, which is gradually replacing its lignite-fired power plants with renewable production.
Steag’s owners, which are large municipalities, are seeking binding offers next week and may pick a winner later this month, according to the people.
Deliberations are ongoing and no final decisions on the timing of a transaction have been taken, they said, asking not to be identified discussing confidential information. Representatives for Asterion, EPH and Steag declined to comment.
The RAG-Stiftung foundation was part of a consortium that in 2020 agreed to acquire a majority stake in Thyssenkrupp AG’s elevator unit in a deal valued at more than €17 billion ($18.6 billion).
Asterion was founded by members of KKR & Co.’s infrastructure investment team, including Jesús Olmos Clavijo. Under its takeover plan for Steag, Asterion would invest at least €1 billion in its green transformation and assume about €1 billion of the utility’s unfunded pension liabilities, people familiar with the matter said.
(Adds detail on Asterion in final paragraph. An earlier version of this story corrected detail of Steag ownership.)
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