GDF Suez looks to sell stake in Australian energy unit

French energy giant GDF Suez is reportedly planning to sell around 30 per cent stake in its Australian electricity generation and retail business in order to cut debt.

GDF Suez has hired Deutsche Bank to find a buyer for the stake in its International Power (Australia) Holdings Pty Ltd unit (IPAH), The Wall Street Journal yesterday reported, citing people familiar with the matter.

The potential sale comes more than six months after GDF Suez, Europe's biggest utility company by market value, sold 28 per cent of IPAH to Japan's Mitsui & Co.

Melbourne-based IPAH is a unit of London-based International Power plc, which in turn is a wholly owned subsidiary of GDF Suez.

IPAH owns and operates 3,540 MW of renewable (wind turbine), gas-fired and brown coal-fired generating plants in Victoria, South Australia and Western Australia, while its retail business sells power and gas to more than 350,000 customers in Victoria, South Australia, New South Wales and Queensland.   

GDF Suez, 36.7 per cent owned by the French government, had in 2012 said that it would sell or deconsolidate assets worth more than €11 billion in Europe and other developed markets in order to reduce its debt of around 34 billion.

It has since sold 80 per cent in its Italian wind-energy subsidiary, IP Maestrale to Italy's ERG SpA for $1.12 billion, 50 per cent of its Portuguese power assets to Japanese trading house Marubeni, and stakes in Brazilian and Canadian power assets to Mitsui.

Formed through the 2008 merger of Gaz de France and Suez, GDF Suez is the world's second-largest power utility company.

It is also the largest gas supplier in Europe and amongst the world's biggest electricity producers.

It generates electricity from wind, biomass and bio gas, hydro, natural gas, coal, nuclear, and other non-renewable sources, and involves in energy procurement and trading business.