* E.ON floats 53.35 pct of Uniper
* Uniper trades at 10.65 euros/share, E.ON down 14 pct
* E.ON, Uniper apart have higher combined market value
* Analysts had expected shares to start at 5.50-13.00 euros
* Flotation comes ahead of listing of RWE's Innogy
(Adds quotes from E.ON, Uniper CEOs, context on valuation)
By Christoph Steitz
FRANKFURT, Sept 12 Investors put a price tag of
3.9 billion euros ($4.4 billion) on power plant and energy
trading firm Uniper on Monday, giving shareholders in
former parent E.ON an insight into the potential
writedowns it faces.
E.ON, which holds 46.65 percent of Uniper after the
spin-off, said last month it valued the division at some 12
billion euros in its books and warned further charges might
follow once Uniper started trading on the stock exchange.
Having already taken more than 18 billion euros in
writedowns on power generation assets since 2014, E.ON will be
forced to book more for Uniper, hitting its weakened balance
sheet and curbing its scope for future investment.
Still, the market value of Uniper and E.ON combined was 1.6
billion euros higher than E.ON's standalone value last Friday.
The German utility hoped that spinning off Uniper would in turn
improve the valuation of the core businesses it retained: gas
and power grids, renewable energy and retail clients.
"We have proven wrong those that said the spin-off won't
work," E.ON Chief Executive Johannes Teyssen told reporters.
In a market debut closely watched by investors, Uniper's
shares traded at 10.65 euros apiece at 1212 GMT, above the
opening price of 10.015 euros and towards the upper end of
potential valuations given by analysts. E.ON slumped 14 percent.
Uniper CEO Klaus Schaefer is hopeful its coal- and gas-fired
plants will still be needed to ensure 24/7 baseload power for
Germany's economy as it moves towards greater use of
intermittent renewable energy, while Uniper also has stakes in
profitable hydropower plants and network grids.
"Investors look at our shares because they understand that
Germany's energy shift is the biggest challenge that we have in
the market," Schaefer told Reuters TV. "I have no concerns about
the future based on our portfolio."
By midday, about 27 million shares in both companies had
changed hands, accounting for about half of all trading activity
among German blue-chips.
"We see a major buying opportunity in Uniper because of the
near-term share price volatility based on forced index related
selling and investor rotation following the demerger," Macquarie
analysts said, starting the company with an "outperform" rating.
Due to selling by index trackers, who got Uniper stock by
virtue of being E.ON shareholders but have to dump it because it
will be excluded from Germany's DAX index, analysts had expected
Uniper to trade anywhere between 5.50-13.00 euros.
E.ON's smaller rival RWE is in the process of
listing its power grids, renewables and consumer business, a
company dubbed Innogy. RWE said on Monday it would sell some of
its existing shares in Innogy in a secondary offering, alongside
a planned capital increase.
($1 = 0.8917 euros)
(Additional reporting by Ludwig Burger, Maria Sheahan, Hakan
Ersen and Reinhard Becker; editing by David Clarke)