(Bloomberg) -- Tennet Holding BV, the Dutch grid operator that failed to sell its massive German grid to Berlin in recent months, is pushing ahead with plans to privatize the unit in what could prove to be another uphill battle.
Tennet has invited investment banks to pitch for roles on a potential initial public offering of the German operations, people with knowledge of the matter said. The company is seeking proposals from banks who want to secure leading roles as global coordinators on a possible listing, the people said.
The move comes as it explores alternative plans for the massive unit after talks about a full sale to Germany fell through, according to the people, who asked not to be identified because the information is private. The Dutch government could announce its plans for Tennet’s German unit as soon as the next few days, the people said.
It has also held talks with a range of pension funds and infrastructure investors, including from Canada and Australia, about the possibility of selling a stake in the business, according to the people. Tennet was previously discussing a valuation of around €22 billion ($24 billion) including debt for the German unit in the now-collapsed negotiations on a deal with Berlin, Bloomberg News has reported.
One key sticking point in any deal will be the billions of euros in investments that the Tennet unit needs in the next few years to upgrade its grid, in order to allow the transmission of renewable energy from Germany’s northern shore to the power-hungry south, the people said.
Representatives for Tennet and the Dutch finance ministry declined to comment.
--With assistance from Eva Brendel.
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