GDF Suez eyes E.ON's natural gas transmission grid

French energy giant, GDF Suez SA yesterday said that along with its consortium partners, it was considering buying the natural gas transmission grid of E.ON AG, which was put on the block by its German rival in a bid to raise around €3 billion ($3.8 billion).

Without naming the consortium partners, Gerard Mestrallet, GDF's CEO, yesterday said on the sidelines of the annual Handelsblatt energy conference in Berlin, "We have formed a consortium to look at the possibility to acquire the gas transport business of E.ON."

The sale is part of the Düsseldorf-based power and gas utility giant's new strategy unveiled a year ago. Under the plan the company would exit the non-competitive markets in Europe and enter rapidly growing markets like South America and Russia.

E.ON had initiated the sale process of its gas transport business operated by its Open Grid Europe unit and asked investors to signal interest by 20 January.

The sale is reported to have drawn the interest of Allianz SE and Canadian investor CPP, which may jointly place a bid and also investment company Macquarie Group Ltd, GS Infrastructure Partners and Canadian infrastructure fund Borealis.

The sale may fetch the company around €3 billion, according to industry experts, and the company will use the proceeds from the deal to reduce existing debt and for reinvestment in emerging markets and reduce dependence on European countries.