Four bidders left for E.ON's Open Grid network

Wed Feb 15, 2012 12:09pm EST
 
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By Tessa Walsh and Alasdair Reilly

LONDON (Reuters) - Four groups have been shortlisted in the 3 billion euro auction to buy German utility E.ON (EONGn.DE: Quote)'s gas distribution network as bidding heats up, banking sources said on Wednesday.

Binding bids are expected in May after due diligence has been completed. Banks are currently working on the financings backing the bids.

E.ON is selling Open Grid Europe, which operates a pipeline network in Germany and is a subsidiary of E.ON's gas supply unit Ruhrgas, to reduce debt.

E.ON could not immediately be reached for comment.

Competition for the assets has been stiff and several strong candidates are still in contention, one source said.

The number of bidding groups was cut after Germany's regulator expressed a preference for consortia which include strategic trade buyers rather than financial bidders only, one source said.

A consortium consisting of GRTGas, which is a subsidiary of GDF Suez GSZ.PA, French insurer CNP Assurances CNP.PA and IFM Australian Infrastructure Fund has been shortlisted.

A second group comprising of Belgium's Fluxys, Global Infrastructure Partners and, according to one source, Caisse de depot et placement du Quebec, also remain in the auction.   Continued...