French energy group Engie is reportedly set to divest part of its majority stake in French natural gas transmission operator GRTgaz.
The stake will be acquired by Société d’Infrastructures Gazières (SIG), a public consortium of CNP Assurances and Caisse des depots, that already owns a 25% stake in GRTgaz, Reuters reported citing sources.
One of the people familiar with the matter told the news agency that Engie could fetch more than €1bn ($1.18bn) from the sale of the 11% stake in GRTgaz.
The potential deal, which is planned to be signed on 30 July 2021, would value GRTgaz at around €10bn as a whole, according to sources.
The sale forms part of French electric utility company’s plan to raise funds for its renewable energy projects and to simplify its structure by offloading assets.
During the 2021-2023 period, Engie aims to divest between €9bn-€10bn ($11bn-$12bn) worth of non-core assets.
GRTgaz operates through two subsidiaries, including GRTgaz Deutschland and Elengy, that are claimed to be key players in the European natural gas transportation market.
In 2019, the French Government enacted new legislation, Plan d’Action pour la Croissance et la Transformation des Entreprises, called Pacte Law.
The law had removed the requirement of the government to hold at least 33.33% share in Engie and that GRTGaz has to be 100% owned only by Engie, the French State or public entities.
The new legislation allows Engie to hold a majority stake in GRTGaz while the government is free to divest its stake in Engie.