German Power Grid Owner Eyes Stake Sale Amid Funding Needs

Major shareholders in Amprion, Germany's second-largest power transmission grid operator, are reportedly considering selling stakes to new investors. This strategic review is driven by the escalating financial demands for modernizing and expanding energy networks across Europe. Amprion is slated to invest more than 36 billion euros by 2029, necessitating ongoing capital injections from its ownership.

Discussions are in their early stages, with some members of Amprion's primary owner, M31, evaluating options that include transferring holdings to co-shareholders or divesting portions of their stakes. The company itself acknowledged that it constantly evaluates financing options for its investments and is engaged in talks with various financial institutions. Its grid spans approximately 11,000 km and has a regulated asset base valued at 11.7 billion euros.

Recent capital increases have seen shareholders provide equity, with Amprion announcing a 2.2 billion euro equity infusion in December. Despite the significant funding requirements, energy grids remain attractive to infrastructure and pension funds due to their regulated, mid-single-digit percentage returns. However, some shareholders, like those backed by AEVWL, are weighing the decision matrix of increasing investment, selling, or facing dilution.