TenneT to Soon Decide Whether to Launch IPO or Private Share Placement for German TSO; German Gov’t Still Considering Buy-In

TenneT Holding is exploring two options to meet TenneT Germany’s equity requirements: a private placement of shares and an initial public offering (IPO), and expects to decide on which option to proceed with in September. The German government has not yet excluded the possibility of buying into the German transmission system operator (TSO).

On 15 July, TenneT Holding said that it had received significant investor interest and that an initial public offering (IPO) and a private share placement were found to be promising options to address the capital requirements of TenneT Germany.

“For the IPO, this means preparing for future discussions with investors, including prospective cornerstone investors. These are investors who will commit, at the time of the future IPO announcement, to purchasing a significant portion of the shares if the IPO proceeds. For the private placement, TenneT will continue talks with potential investors to get to a binding offer to fulfill TenneT Germany’s capital requirements”, TenneT Holding said.

With finding a structural solution for TenneT Germany’s capital requirements in 2025 being a priority for TenneT and its shareholder, TenneT aims to determine in September which of the two options will be chosen and subsequently implemented, the holding company said earlier this month.

TenneT has been operating as two businesses, one in the Netherlands and one in Germany, under TenneT Holding since 1 January 2025, as part of the plan to bring in private investment into TenneT Germany.

The Dutch State-owned TenneT has been looking to sell TenneT Germany since 2023, with initial plans for the German State to take over the German business.

On 2 January 2025, TenneT announced that the negotiations with the German State, via KfW representing the German Federal government, were terminated after the Government of Germany informed the Dutch State that it could not deliver on the planned transaction due to budgetary challenges. 

In March, Reuters reported that TenneT was still open for the German State to take a stake in TenneT Germany, and that the company was also considering a stock exchange listing for the German TSO as an alternative to raise capital.

According to recent news on Reuters, Germany is still considering buying a stake in TenneT. German Chancellor Friedrich Merz said this month that the government had not yet decided on the matter and that it was still in talks with the Netherlands, Reuters reported on 21 July.

In its first-half 2025 (H1 2025) results, published on 25 July, TenneT Holding reported an underlying revenue of EUR 4.4 billion in the first six months of this year, up from EUR 4.1 billion in H1 2024, and an underlying EBIT of EUR 1.5 billion, an increase compared to EUR 1 billion in the first half of 2024.

Investments in Dutch and German onshore and offshore electricity infrastructure increased to EUR 5.5 billion in the first six months of this year, TenneT says. In the same period last year, the TSO’s investments stood at EUR 4.6 billion.

By 2034, TenneT plans to invest a total of EUR 200 billion in grid enhancements and expansion in the Netherlands and Germany. 

Offshore Germany, TenneT added two new converter platforms in the first half of this year, one for the BorWin5 offshore grid connection and one for DolWin5, increasing the transmission capacity in the German North Sea to almost 10 GW.