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Allianz buys into E.ON’s Romanian unit

The insurance group’s alternatives division has taken a 30% stake in E.ON Distributie România, marking its first investment in the Eastern European country.

Allianz Capital Partners has agreed to buy a 30 percent share in E.ON Distributie România, the Romanian arm of energy giant E.ON.

E.ON Distributie România owns and operates a 20,000km gas pipeline and also serves three million customers in the country’s north via an electricity distribution grid of over 80,000km.

ACP’s entry into the company will dilute E.ON’s holding to 56.5 percent, with the remaining 13.5 percent held by the Romanian government. E.ON had been looking for new investors since June after Romanian investment fund Fondul Proprietatea sold its 18 percent stake back to E.ON following a fierce dispute between the two firms over corporate governance and supply contracts signed by the German utility.

“Romania is a promising European growth market,” said Christian Fingerle, ACP’s chief investment officer. “It fits well with Allianz’s investment strategy as a long-term investor.” Allianz said the deal is expected to close before the end of the year.

Last week E.ON Distributie România’s board approved a move to change the name of the company to Delgaz Grid as of the beginning of next year.