Failure of the Tennet electricity grid sale to the government
The talks concerning Tennet's Dutch grid subsidiary selling its German division to the Federal Republic of Germany have fallen through. Tennet disclosed on Thursday that the discussions between Tennet Holding and the KfW state development bank, acting on behalf of the Federal Republic of Germany, for a full acquisition of Tennet Germany, have been futile.
The Federal Government conveyed to the Dutch state that it would not be feasible to execute the proposed deal due to budget constraints.
Now, Tennet is seeking alternative financing methods. As the company stated, Tennet Holding is planning to reach out to both public and private capital markets to discover a long-term financial solution for its German operations. The Federal Government is open to backing such alternative approaches.
Moreover, it was mentioned that Tennet is hanging on to its expansive investment plans in both countries and is receiving backing from the Dutch state. The Dutch state recently bestowed upon Tennet a shareholder loan of 25 billion Euros for the years 2024 and 2025.
Within the Federal Government, tough negotiations are underway regarding a draft for the 2025 Federal Budget and medium-term financial planning. Multiple ministries are resisting meeting the savings requirements set forth by the Finance Ministry.
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Tennet Holding is now engaged in negotiations with various entities in both public and private capital markets, aiming to find a long-term financial solution for its German operations, following the unsuccessful sale of Tennet Germany to the Federal Republic of Germany. Under the proposed covenant, the Federal Government has shown openness to supporting such alternative financing approaches.
