E.ON separates fossil fuel business to focus on renewable
German energy utility E.on has separated its fossil fuel business in order to focus on its renewable energy assets.
A new entity Uniper has also been created by E.on to operate its conventional power generation assets including hydropower, natural gas and coal.
The new Düsseldorf-based independent firm will also hold global energy trading operations carried out by E.on in order to ensure security of the energy supply.
Upon securing shareholder approval, Uniper spinoff is scheduled to take place in the second half of this year. Majority of shares of the Uniper will be publicly listed.
Following spin off, E.on will focus on renewables, distribution networks and customer solutions.
E.on CEO Johannes Teyssen said: "This liberates us from continually having to make compromises.
"Our ambition is for both companies, which soon will be legally independent of one another, to become leading players in their respective energy worlds.
"Separating these businesses, which were formerly managed together, will make both companies more agile and sharpen their profile for customers and investors."
The firm plans to take new approaches to develop each of its three core business areas with an investment of about €0.5bn.
About 40,000 employees would remain with E.ON and the remaining 20,000 would join the new company.
The strategic reorganization plan was proposed in November 2014.
Image: The E.on's storage power plant Walchensee in Germany. Photo: courtesy of Rolf Sturm/E.ON.