RWE succeeds in deal – JPMorgan gives thumbs up

RWE shares are gaining ground at the start of the week. After a lengthy search, the energy company has succeeded in finding an investor for its stake in the transmission system operator Amprion. RWE originally intended to sell its 25.1 percent stake entirely, as the grid expansion requires enormous investments. However, a sale failed. Instead, a co-investor has now been secured.

RWE is establishing a new joint venture with asset manager Apollo Global Management, in which the Essen-based company will contribute its share. RWE will retain operational control.

Apollo is paying RWE €3.2 billion upfront. The money is earmarked for the expansion of Amprion's grids, a project that will require enormous resources. The transaction is expected to close at the end of 2025. Amprion, one of four transmission system operators in Germany, operates the major power lines. The remaining stake in Amplion is held by M31, a company in which insurers and pension funds such as Swiss Life and Talanx, among others, hold stakes.

Analysts view the solution positively. RWE will receive capital to support Amprion's investment program over the next ten years – at more favorable terms than Amprion's government-regulated returns. Furthermore, the option to sell the stake at a later date remains, according to Javier Garrdo of the US bank JPMorgan. He maintains an "overweight" rating on RWE shares with a price target of €46.50.