RWE Forced to Re-Purchase UK Business from LetterOne in Case of Sanctions Against Fridman

RWE would be forced to re-purchase the UK business during the first year post completion of the sale of RWE Dea in case European authorities sanctioned LetterOne Group or its owners, reads a note released by the German company on Thursday. 

RWE AG agreed with Letter One Group to complete the sale of RWE Dea by early March 2014, for an enterprise value of ca. €5 billion. 

‘As part of the revised transaction LetterOne Group will keep Dea UK separate from the remaining RWE Dea activities for a number of years. In the unlikely event that sanctions on LetterOne or its owners were imposed, RWE will retain the obligation to re-purchase the UK business during the first year post completion of the sale of RWE Dea’ reads the note released on Friday.

RWE reiterated the importance of the transaction for the company’s long term profitability. 

“The economics are attractive and therefore the Dea disposal remains an essential step towards executing our strategy and improving our financial strength. We are on track!” Peter Terium, CEO of RWE AG, commented. 

LetterOne is a global investment vehicle founded in 2013 by Mikhail Fridman, a Russian businessman of Ukrainian Jewish descent.