Fortum and E.ON said on Wednesday that they are in advanced negotiations for the sale of E.ON’s fossil fuel-based power plant business Uniper.

In a statement, E.ON said Fortum would pay €3.8bn ($4.6bn) for its 47 per cent share in the firm.

Given that E.ON owns over 30 per cent of Uniper, under German law Fortum would be obligated to make a full acquisition bid if a deal with E.ON was agreed. Fortum said it would offer €22 per share, with a €8.1bn valuation for Uniper.

“Should Fortum reach an agreement with E.ON,” Fortum said in a statement, “Fortum would make a voluntary Public Takeover Offer to all shareholders of Uniper under the German Securities Acquisition and Takeover Act.

“E.ON could tender its stake of 46.65 per cent in Uniper into the Offer in early 2018.”

However, Uniper said in a statement that it has not received and “has not invited Fortum to make a takeover offer”.

Klaus Schäfer, Uniper’s CEO, said the “unsolicited takeover offer is clearly not in line with the strategy of Uniper as recently reiterated publicly”.

“Uniper is currently not in discussions with either Fortum or E.ON in regard to the unsolicited and conditional transaction proposals described in their respective statements,” the company said.

For its part, Fortum said it is not interested in a full takeover, adding in a statement that “as Uniper has stated its intention to remain independent”, it “would focus on being an active, supportive and reliable shareholder of Uniper” and a “constructive strategic partner”.

However, the firm said the two businesses are “highly complementary”, calling Uniper’s hydropower and nuclear power plants in Sweden “an excellent fit with Fortum” and drawing a parallel between the two firms’ gas-fired fleets in Russia.

Fortum also pointed to Uniper’s gas-fired, coal-fired and hydropower plants in continental Europe, saying they “have an essential role in providing security of supply and affordable energy as Europe transitions towards low emission energy”.

“In addition, Uniper has extensive commodities trading activities that are complementary to the power generation business,” Fortum said.

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