By Christoph Steitz
FRANKFURT (Reuters) -EnBW is in talks with its major shareholders over a potential capital increase of around 3 billion euros ($3.3 billion) to help the company make bigger investments in Germany’s energy transition, the company said.
Any decision over a possible share issue will be up to the group’s shareholders at the annual general meeting based on a proposal by the group’s management and supervisory boards, EnBW said in a statement on Friday.
Shares in EnBW, which has a free-float of just 0.39%, were 2.1% higher following the news.
EnBW, most of which is owned by the German state of Baden-Wuerttemberg and local municipalities, said investments in energy projects could rise to around 50 billion euros by 2030, up from at least 40 billion expected previously.
The group said this included new wind and solar parks, hydrogen-ready gas power plants, energy grid expansion as well as the build-out of electric mobility.
“This results in above-average capital requirements that cannot be covered by operating income alone,” EnBW said, adding management was examining financing options “in view of the historically high level of investment”.
EnBW said it was also using its access to capital markets to tap debt markets, supported by favourable credit ratings. EnBW has secured a long-term issuer rating of Baa1 and A- at Moody’s and Standard & Poor’s, respectively.
($1 = 0.9022 euros)
(Reporting by Christoph Steitz; Editing by Matthias Williams and Philippa Fletcher)
