February 23, 2018 / 9:38 AM / 10 months ago

Belgium's Elia has two months to move on 50Hertz stake eyed by State Grid

FRANKFURT, Feb 23 (Reuters) - Belgium transmission network operator Elia said on Friday it had about two months to decide whether to exercise a right to buy another 20 percent in German unit 50Hertz, the target of State Grid Corp of China .

Elia said in December that Australian fund manager IFM Investors was in talks to sell the stake to State Grid, the world’s biggest utility, or one of its subsidiaries. Elia owns 60 percent in 50Hertz, IFM holds the remaining 40 percent.

“Elia has approximately two months to decide to exercise its pre-emption right,” the group said as it published full-year results showing that earnings before interest, tax, depreciation and amortisation (EBITDA) grew by 12 percent to 475.5 million euros ($585.6 million) in 2017.

Elia said it was assessing the possible transaction and “will inform the market once it has determined its position.”

50Hertz is one of Germany’s four high-voltage power transmission grids, the others being Amprion , Tennet IPO-TTH.AS and Transnet BW.

The regulated asset base of Elia’s 60 percent stake in 50Hertz’s, a key measure of a network’s value, stood at 3.2 billion euros ($3.9 billion) at the end of 2016, suggesting a 20 percent stake in the asset could be worth more than 1 billion euros.

This is much higher than the 810 million euros former Swedish owner Vattenfall received when it sold all of 50Hertz in 2010 to Elia and IFM, indicating appetite infrastructure investors have for regulated assets.

$1 = 0.8120 euros Reporting by Christoph Steitz; Editing by Edmund Blair

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