E.ON Ruhrgas to sell its stake in Gazprom: report

24th November 2010, Comments 0 comments

Germany's E.ON Ruhrgas, the largest foreign shareholder in Gazprom, will soon sell its stake in the Russian natural gas giant as part of a European assets sale plan, Kommersant reported Wednesday.

The German gas company intends to sell its 3.5-percent stake in Gazprom to Russia's Vnesheconombank, the state-held economic development bank, the respected business daily quoted multiple sources as saying.

The sale has been agreed by both sides and is pending approval from the German and Russian governments, Kommersant said.

Worth 4.5 billion dollars (3.36 billion euros) at Tuesday's closing share price, the stake could not be sold on the open market for fears of damaging the Russian company's market capitalisation, the report said.

The newspaper noted that Russian Prime Minister Vladimir Putin was likely to discuss the deal with German Chancellor Angela Merkel on Friday during his two-day working visit to Germany.

E.ON Ruhrgas is the natural gas arm of E.ON, the world's biggest private utilities group. E.ON acquired Ruhrgas in 2003 in an effort to expand into the natural gas market.

Earlier this month, E.ON announced a major strategy shift, deciding to turn its focus away from Europe in favor of emerging markets in Asia and South America.

E.ON did not say which European assets would be put on the block as part of the shift although European press reports have also identified its power grid in Britain, thought to be worth about four billion euros.

© 2010 AFP

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