November 30, 2016 / 4:05 PM / a year ago

Lichtblick talked to Enel about possible sale: sources

FRANKFURT/MILAN (Reuters) - Lichtblick, Germany’s largest independent supplier of renewable energy, is looking at strategic options for its business and has talked to Italy’s Enel (ENEI.MI) about a possible sale, several people familiar with the matter said.

A deal could give unlisted Lichtblick - which made sales of 665 million euros ($707 million) and profit after tax of 15.1 million euros last year - a value of up to 500 million euros, one of the people said.

The people said Enel was interested in entering the German market and had looked at Lichtblick’s 650,000 customers to expand its retail network, but added that interest in a takeover had cooled recently.

Enel, Europe’s largest utility by customers, last week said it aimed to boost its retail base to around 64 million end users from 62 million currently as part of plans to refocus its business on grids, renewable energy and customers.

Dutch energy group Eneco [ENECO.UL] has also looked at Lichtblick, the sources said.

A spokesman for Lichtblick confirmed the group was in talks with possible strategic partners, without being more specific, and said it had hired boutique investment bank Greentech Capital Advisors to explore options.

“It is open whether Lichtblick will take on board new partners or continue its growth strategy in the current set-up,” he said in e-mailed comments.

Enel and Eneco both declined to comment.

Hamburg-based Lichtblick mainly supplies hydroelectric power, which it buys and sells on to its clients as it has no generation capacity of its own. It also offers technology to link different renewable stations to control and optimize their performance.

    Utilities are placing a lot of hope on customer access, keen on offering services that go beyond selling electricity such as software that lets retail clients control energy usage remotely via their smartphones.

    Retail exposure, so the thinking goes, will help them overcome a crisis in conventional fossil-fuel based power generation, where margins have dwindled due to low wholesale electricity prices and a surplus of solar and wind power.

    “There is interest in the German retail market, which promises low but acceptable returns,” one of the people said.

    Innogy (IGY.DE), Germany’s largest energy group which has about 8.1 million customers in the country, made an EBITDA margin of 3.2 percent in its German retail business in the first nine months of the year.

    This compares with 3.5 percent at smaller peer E.ON (EONGn.DE).

    Editing by Maria Sheahan and David Evans

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