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RWE sells off oil, gas division to Russian tycoons

March 17, 2014 at 7:35 AM   |   Comments

ESSEN, Germany, March 17 (UPI) -- German utility company RWE said it agreed to sell off its oil and gas production unit DEA to an investment group led by Russian oil tycoon Mikhail Fridman.

Fridman, the former chief executive officer at Russian energy company TNK-BP, leads a group of investors in the $7.1 billion purchase of DEA, the German utility announced Sunday.

The German company said in a statement the deal with investment group LetterOne, which includes about $800 million in debt, is subject to the approval of the supervisory board.

"[Both sides] will clarify the further details shortly in order to enter into the sale and purchase agreement," RWE said in a statement.

RWE in early March reported a $3.8 billion loss for 2013.

Fridman and fellow investor German Khan established LetterOne after they sold their shares in TNK-BP last year for $14 billion. There was no statement on the German acquisition from the investment group.

The New York Times reported Sunday the German company has been trying to sell off its oil and natural gas division to focus on utilities. Germany's power sector, meanwhile, is struggling to find new footing after the government decided to abandon nuclear power following the Fukushima disaster in 2012.

Last month, The European Union said the amount of renewable energy connected to the German grid quintupled from 1990 levels by 2009, the last full year for which the EU published data.

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