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Analysis by a team from Compass Lexecon, a subsidiary of FTI Consulting, removed several of the competition concerns that the EC had put forward when opening a Phase II investigation of the transaction.
Merger Cleared
Driving E.ON’s Acquisition of Innogy Assets from RWE in Germany’s Largest Energy Transaction
Merger Cleared
Driving E.ON’s Acquisition of Innogy Assets from RWE in Germany’s Largest Energy Transaction
Key Contacts
How do you remove competition concerns and set the stage for transformational growth?
In March 2018, German energy company E.ON, one of the world’s largest electric utility providers, announced that it would acquire the distribution and consumer solutions business as well as some electricity generation assets of Innogy from its controlling shareholder and Germany’s second-largest utilities company, RWE.
The €43 billion acquisition was part of an extensive asset swap transaction between E.ON and RWE. The European Commission (“EC”) announced an in-depth merger investigation into the transaction in March 2019, citing concerns that the combined entity would lessen competition in retail markets for electricity and gas in some member states.
Our Impact
Europe’s largest energy transaction to date was completed in 2020, positioning E.ON as a major energy operator, with more than 50 million customers in 15 countries.
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In September 2019, the EC approved the transaction on the condition that E.ON sold certain electricity and gas retail businesses in Germany, the Czech Republic and Hungary, and the acquisition was completed in 2020.
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RWE and E.ON completed their asset swap. E.ON’s wind, solar and hydropower businesses, as well as biomass, biogas and gas storage activities, were transferred to RWE.
In crisis and transformation,what matters most is what you do next.
Our Role
Addressing competition concerns and facilitating merger approval
Compass Lexecon was engaged by E.ON from the outset to advise the company throughout the merger control proceedings and provide economic analyses of the impact of the acquisition on energy markets in Germany, the UK, the Czech Republic, Hungary and Slovakia, where the companies’ activities mostly overlap.
The Compass Lexecon team developed and presented to the EC several economic analyses to assess the likelihood of unilateral effects in the energy market in Germany, the UK and three Central and Eastern European countries (Czech Republic, Hungary and Slovakia).
Experts conducted margin-concentration analysis and assessed market competition in Germany’s retail market.
Our teams analysed tender data and market dynamics in the UK and Central and Eastern European markets.
Real-world experience that delivers.
See why FTI Consulting is the leading global expert firm for organizations facing crisis and transformation.
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