Innogy agrees with E.ON and RWE on planned transaction

FILE PHOTO: Innogy logo before the company's annual news conference in Essen, Germany March 12, 2018. REUTERS/Wolfgang Rattay/File Photo

BERLIN (Reuters) - Innogy IGY.DE said it has reached two legally binding agreements with E.ON EONGn.DE and RWE RWEG.DE for a fair integration process and supported its planned break-up, clearing the way for the complex deal to progress.

The agreements mark a major step towards an asset swap deal between RWE and E.ON, which will effectively mark the end of Innogy as an independently listed company and has led to concerns that it could bear the brunt of planned job cuts.

“The agreements with E.ON and RWE lay the groundwork for a fair integration processes on equal terms and thus for constructive collaboration in the future,” Innogy CEO Uwe Tigges said in a joint statement with E.ON and RWE.

“Considering the fact that Innogy is being taken over, we negotiated the best possible deal for our employees,” he said.

The companies agreed to treat all employees as fairly and as equally as possible as part of the integration, regardless of which company they work for, and to take into account the respective companies’ strengths.

E.ON and Innogy have also agreed to fill top leadership positions in a fair and transparent way. There will be joint planning on the integration between all three companies.

RWE, which owns 76.8 percent of Innogy after an equity carve out in 2016, agreed in March with rival E.ON to break up Innogy, with E.ON saying it would cut up to 5,000 jobs as part of the transaction.

The companies had said in May they had reached a framework deal to ensure the break-up of Innogy would happen without forced layoffs.

Reporting by Caroline Copley; Editing by Douglas Busvine and Tom Hogue