E.ON Clinches 1.8 Billion Euro Green Bond Deal as Berlin's Urenco Ambitions Stay Under Wraps

E.ON has moved to lock down next year's funding early, placing 1.8 billion euros in green bonds while speculation swirls over whether the German government will buy the utility's stake in uranium enrichment group Urenco.

The two-tranche issue, announced by the company, splits into an 800 million euro note maturing in seven years with a 4.26% coupon and a 1.0 billion euro tranche running eleven years at 4.59%. According to E.ON, the financing requirement of 4.7 billion euros for 2026 is now fully covered, and pre-funding has begun for the year after.

A State Stake in Urenco?

The bond placement came as Reuters reported that Berlin is weighing the purchase of the one-third holding in Urenco jointly owned by E.ON and RWE. The draft 2027 budget reportedly earmarks 4 billion euros for such a move. Neither the federal government nor the two utilities would confirm the plans, and no sale or purchase price has been confirmed. Handelsblatt had earlier reported the entry plans, citing government circles.

Investors responded to the chatter: E.ON shares added 2.1% in the session.

Two Brokers, Two Verdicts

Valuation concerns had already prompted Morgan Stanley to cut its rating on Monday, lowering E.ON from "Overweight" to "Equal-weight" while keeping the price target at 21 euros. Analyst Robert Pulleyn pointed to the stock's prior rally and a valuation now on par with other integrated utilities, flagging more attractive sector opportunities at names including National Grid and RWE.

The DZ Bank took the opposite tack on Thursday, lifting its fair value to 20 euros from 19 and reaffirming "Hold." Analyst Werner Eisenmann cited solid nine-month figures, confirmed annual targets and improvements in grid regulation, while listing distributions and valuation as counterweights.

Nine-Month Figures Hold Steady

Those nine-month numbers, released on Wednesday, showed adjusted group EBITDA of 7.1 billion euros for the first three quarters of 2026, flat year on year, with adjusted net income up 4% at 2.2 billion euros. E.ON reaffirmed both its full-year guidance and its outlook through 2030.