Several major infrastructure investors have submitted non-binding offers for a minority stake in the German division of Dutch transmission grid owner TenneT, according to sources.

A tie-up of CPP Investments and Iberdrola, advised by Barclays, filed an offer ahead of yesterday’s deadline, as did Singapore’s sovereign wealth fund GIC, advised by JPMorgan, the sources added.

A consortium comprising Dutch pension fund APG, advised by RBC, and Norges Bank Investment Management is also among the bidders. Their joint participation in the TenneT sale comes after the consortium withdrew from the sale of RWE’s stake in Amprion, another large German grid operator in the market, the sources explained.

Copenhagen Infrastructure Partners (CIP), CDPQ and Allianz are also said by sources to have filed non-binding offers for TenneT, in a process that will require incoming investors to commit up to around EUR 4bn of investment.

The deal will involve the new investor acquiring new shares rather than those of the existing shareholders.

TenneT’s German arm generated EBITDA of about EUR 3bn in 2024, according to calculations by S&P.

Given the scale of the transaction, sources said that Lazard and ABN AMRO, the sellside advisors, are giving flexibility to the bidders to join forces at a later stage, if they decide to do so.

Sources added that while CIP filed an offer that entails it investing less than EUR 4bn, this flexibility means it could still advance in the process by joining a consortium.

After the collection of NBOs, the next crucial step in the process is the upcoming decision by the Dutch government, TenneT’s owner, on moving ahead with the sale or pursuing a partial initial public offering for the business instead.

This decision is expected to be formally announced in July, as laid down in May in the recent letter sent to the parliament by Dutch Finance Minister Eelco Heinen.

TenneT is one of Germany’s four transmission grid operators alongside 50Hertz Transmission, TransnetBW and Amprion.

Last month, the asset management subsidiary of German lender Commerzbank, Commerz Real, acquired an indirect share of around 4.5% in Amprion.

Other recent deals in the sector saw German utility EnBW selling a 24.95% stake in TransnetBW to a consortium led by local insurance group SV SparkassenVersicherung, for around EUR 1bn.

The buyer agreed to pay around EUR 1bn for the stake, an EnBW spokesperson confirmed to Infralogic.

Investing in transmission grid operators offers a significant growth opportunity, but also large capital requirements.

Amprion has vast investment plans totalling some EUR 35bn over the next four years, much of which is due to be funded by equity, to cover upgrades to accommodate increasing renewables penetration and growing electric vehicle use.

While such investment places large financial demands on investors, it also holds the prospect of strong returns underpinned by government support for the energy transition.

APG, Barclays, TenneT, JPMorgan, GIC, Norges and CPP declined to comment. Iberdrola, Allianz, CDPQ and CIP did not respond to requests for comment.