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E.ON Hungária buys regional power stakes ahead of buyout offer

The Hungarian unit of German utilities giant E.ON will acquire nearly all of the shares of regional electricity distributors ELMŰ and ÉMÁSZ as the result of transactions and agreements announced last Friday, the same day the company made a mandatory public purchase offer for outstanding shares of the listed companies.

E.ON Hungária announced on Friday public purchase offers for the outstanding shares of ELMŰ and ÉMÁSZ. It will offer HUF 34,585 per share for the shares of ELMŰ, and HUF 31,701 per share for the shares of ÉMÁSZ, according to state news agency MTI.

E.ON Hungária is offering a premium of about 18% over the 180-day average price of ELMŰ shares, and a premium of around 22% over the 180-day average price of ÉMÁSZ shares, MTI noted.

The buyout offers must still be approved by the National Bank of Hungary (MNB).

E.ON became the indirect majority owner of both ELMŰ and ÉMÁSZ after its acquisition of the companiesʼ parent, German peer Innogy, was approved by the European Commission on September 17. E.ONʼs acquisition of the majority stakes in ELMŰ and ÉMÁSZ triggered a mandatory public purchase offer under capital market rules.    Innogyʼs stake in ELMŰ is 55.25%, while it owns 54.26% of ÉMÁSZ.

E.ON acquires EnBW stakes; MVM also to sell

In separate disclosures, ELMŰ and ÉMÁSZ said E.ON Hungária had acquired 27.25% and 26.83% of their respective shares. Although the disclosures did not mention the seller, MTI noted that the stakes match those held by Germanyʼs EnBW.

EnBW confirmed on its website on Friday that it had sold its stakes of "about 27%" in ELMŰ and ÉMÁSZ to the local unit of E.ON. With the divestments, EnBW has exited the Hungarian market, the firm noted.

In yet another announcement on Friday, the state-owned Hungarian Electricity Works (MVM) said it had also agreed to sell its stakes in ELMŰ and ÉMÁSZ to E.ON Hungária, while in turn acquiring a 25% stake in the latter.

MVM owns 15.86% of ELMŰ and 13.11% of ÉMÁSZ, noted MTI.

MVM also agreed to acquire all of ÉMÁSZ Hálózati Kft., which operates and maintains ÉMÁSZ ʼs network, and 50% of Budapesti Dísz- és Közvilágítási Kft., the public lighting company in the capital. The agreement is in line with the MVM groupʼs strategic goals and opens the door to possible cooperation on the Romanian energy market, MVM said.

Just 1.64% of ELMŰ shares and 5.8% of ÉMÁSZ shares are in free float. Both companies are listed in the Equities Standard category of the Budapest Stock Exchange (BÉT).