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Ceding power

June 8, 2009

German energy giant E.ON AG has agreed to sell 13 power plants to Austrian electric utility, Verbund. The move is meant to allay EU anti-trust concerns.

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A pylon against a cloudy sky
E.ON is one of four players dominating the German electricity marketImage: AP
Verbund, Austria's biggest electricity producer, announced on Monday that it had agreed to buy 13 hydroelectric power stations from German rival E.ON.

Both companies agreed not to divulge the sale price for the plants, which have a combined capacity of 312 megawatts and are situated along the river Inn in the German state of Bavaria.

Verbund said the transaction would be sealed in the third quarter of 2009, pending approval by the European Commission - the 27-member bloc's competition watchdog.

The deal is part of E.ON's commitment to the EU Commission, made last year, to divest itself of 5,000 megawatts of generating capacity, as well as its high voltage power lines in Germany.

Including the sale to Verbund, E.ON has reportedly struck deals equivalent to shedding 3,200 megawatts. E.ON has announced plans to swap power plants with Belgium's Electrabel and has also transferred stakes in plants to German utility Energie Baden-Wuerttemberg AG.

nk/dpa/AFP

Editor: Chuck Penfold