The logo of the German power supplier RWE is pictured at the RWE headquarters in Essen, Germany, November 15, 2021. REUTERS/Thilo Schmuelgen
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FRANKFURT, March 29 (Reuters) – RWE (RWEG.DE) urged investors on Tuesday to reject a motion put forward by activist shareholder Enkraft for the Germany utility to prepare a spin-off of its brown coal activities when they vote at its annual general meeting on April 28.
Enkraft has argued that a spin-off of the polluting brown coal or lignite business would remove a discount that weighs on RWE’s stock and could potentially add 16 billion euros ($17.8 billion) in market value to Germany’s largest power producer.
“The spin-off of the lignite business proposed by Enkraft is the least appropriate of several ways to continue developing the RWE Group,” the company said in a response to the motion published on its website.
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In its statement, RWE said a spin-off would also close the door for “more promising alternatives that could be developed with the consent of policymakers, such as a transfer to a foundation”.
Enkraft said it welcomed that fact RWE views a foundation model for lignite – a scenario initially tabled by the current government – as a promising alternative but urged the company to take the initiative and not leave it with policymakers.
RWE, which is also one of Europe’s largest renewables players, said in its response to Enkraft’s motion that it would become “proactively and constructively involved” in discussions about a foundation.
($1 = 0.9000 euros)
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Reporting by Christoph Steitz; Editing by Madeline Chambers and David Clarke
Our Standards: The Thomson Reuters Trust Principles.
Source: Reuters