FRANKFURT (Reuters) - German insurance players Munich Re (MUVGn.DE) and Allianz (ALVG.DE) declined comment on a newspaper report on Monday that they were interested in buying the German business of Dutch grid operator TenneT TNETH.UL.
TenneT’s financing problems have been a major obstacle in Germany’s offshore wind expansion and the German government is urging the company to sell the German unit, daily Handelsblatt reported, citing people familiar with the negotiations.
“I cannot confirm that interest,” a Munich Re spokeswoman said. Allianz and TenneT declined to comment.
TenneT is responsible for connecting offshore wind plants in the North Sea with the German electricity grid but has said it cannot afford the necessary investment, which Handelsblatt put at 15 billion euros ($18.5 billion).
Two sources familiar with the matter had told Reuters on Friday that German Economy Minister Philipp Roesler will discuss TenneT’s financing woes when he meets with the Dutch government this week.
TenneT is responsible for connecting offshore wind plants in the North Sea with the German electricity grid but has said it cannot afford the necessary investment.
Like many other insurers, Allianz and Munich Re are looking for long-term infrastructure investments with stable income -akin to bonds - that they can use to match against their long-term obligations to policy holders.
These are typically turn-key operations already running on the grid, rather than projects that require fresh investment in technology or construction.
Munich Re has budgeted 2.5 billion euros for renewable energy investments in the medium term and has already ploughed more than 600 million euros of that amount into the sector.
On Monday, it announced that it was spending a low triple-digit million euro amount to buy three onshore wind parks in Britain with a total output of 102 megawatts. ($1 = 0.8121 euros)
Reporting by Ludwig Burger and Christoph Steitz; Editing by Jonathan Gould and David Holmes