RWE pens $3.7bn Apollo deal for stake in German TSO

German energy company RWE has formed a strategic alliance with US asset manager Apollo Global Management to secure funding for its investment in Amprion, Germany’s key transmission system operator. This partnership involves a substantial financial commitment from Apollo, which will strengthen RWE’s position in the energy sector while supporting the expansion of Germany’s electrical grid. The deal is expected to finalize by the end of 2025.

Details of the Partnership

In a landmark agreement, Apollo Global Management will invest €3.2 billion (approximately $3.76 billion) in RWE for a stake in a newly formed joint venture. This venture will manage RWE’s 25.1% equity interest in Amprion, a critical component of Germany’s energy infrastructure. Amprion operates the transmission grid across seven federal states, catering to roughly 29 million residents. The partnership aims to bolster RWE’s capabilities in managing and expanding this vital grid system.

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The funds from Apollo will be disbursed upfront, allowing RWE to reinvest the capital directly into Amprion’s grid expansion initiatives as necessary. Despite this investment, RWE will maintain operational control over the joint venture and continue to oversee its interest in Amprion. As part of this arrangement, the dividends generated by Amprion will be shared between RWE and Apollo, ensuring that both parties benefit from the venture’s success.

Apollo’s involvement is expected to bring its extensive experience in long-term capital and infrastructure investments, positioning it as a valuable ally for RWE in navigating the complexities of energy transmission in Germany. This partnership not only signifies a commitment to enhancing Germany’s energy grid but also highlights the growing collaboration between European and American firms in the renewable energy sector.