The U.K. is open to talks
on RWE AG (RWE)’s plan to sell its Dea unit to a group led by Russian billionaire
Mikhail Fridman, but still concerned it would leave British gas fields at risk
from future sanctions against Russia, a person familiar with the matter said.
The U.K. wants to avoid the
kind of disruption from sanctions that halted output at the partly Iran-owned
Rhum field in the North Sea, according to the person, who asked not to be
identified as RWE is still talking with Fridman’s group. RWE needs to offer the
U.K. new proposals, the person said.
Britain is holding up RWE’s
proposed 5.1 billion-euro ($6.2 billion) sale of Dea to Fridman’s LetterOne
group after German regulators approved the deal. U.K. Energy Secretary Ed Davey
doesn’t plan to provide a letter needed to allow British assets to be sold, a
government official familiar with the discussions who asked not to be named
said in October.
RWE thinks it can assuage
U.K. worries, Chief Executive Officer Peter Terium said, according to the Financial
Times. Annett Urbaczka, a spokeswoman for RWE in Essen, Germany, declined to
comment when contacted by phone today.
Germany’s largest power
producer is trying to sell assets and cut capital spending to cope with
slumping European power prices and surging debt. The deal with LetterOne,
announced in March, came under scrutiny as Russia’s annexation of Ukraine’s
Crimea region undermined relations with Europe and the U.S.
Dea’s U.K. assets are
valued at about 1 billion euros, Chief Financial Officer Bernhard Guenther said
in November.
Rhum, a venture between BP
Plc and Iranian Oil Co. U.K. Ltd., halted output in 2010 for almost four years
to ensure compliance with European sanctions against Iran. Gas flows
resumed in October.
(Bloomberg)