RWE to sell more of Innogy in listing to satisfy demand

By Christoph Steitz and Matthias Inverardi

FRANKFURT/DUESSELDORF (Reuters) - German utility RWE plans to list more of its renewables, network and retail business Innogy than originally planned in an initial public offering next month after strong investor interest, its chief executive said on Monday.

"There is considerable interest among investors," Peter Terium, who is CEO of both RWE AG and Innogy, told Reuters after RWE published the "intention to float" for Innogy, a step during an IPO which usually happens about four weeks before a listing.

Germany's second-largest utility said in December it planned to pool its renewables, network and retail assets and list 10 percent of the business through a capital increase expected to fetch about 2 billion euros (1.7 billion pounds).

However, the size of the IPO will now be larger as RWE will also sell existing shares alongside the capital increase, Terium said, adding that no decision had been reached over how large the secondary offering would be.

Innogy's high share of regulated business is expected to attract infrastructure investors and pension funds, eager to buy stable assets with guaranteed returns.

In another German power spin-off, investors put a price tag of 3.9 billion euros ($4.4 billion) on power plant and energy trading firm Uniper when it began trading on Monday.

This gives shareholders in former parent E.ON an insight into the potential writedowns it faces.

Terium said RWE was seeking investors who would be buying Innogy shares for the long-haul.

"We want both: a broad distribution of shares but also long-term investors that can become anchor shareholders," he said.

Following the IPO, RWE will be Innogy's main shareholder with a stake of 90 percent or less, depending on how many shares it sells in addition to the capital increase.

RWE wants to remain a majority shareholder in the long-term.

(Editing by Harro ten Wolde and Alexander Smith)