TotalEnergies has signed an all-stock transaction with Energetický a průmyslový holding (EPH) valued at €10.6 billion, marking one of the company’s most significant strategic moves in the European power market. The deal involves acquiring 50% of EPH’s flexible power generation platform, which includes gas-fired and biomass plants, as well as battery assets, across Italy, the United Kingdom, Ireland, the Netherlands, and France. The agreement forms a fifty-fifty joint venture that will expand TotalEnergies’ presence in flexible electricity generation and accelerate the company’s Integrated Power strategy.
EPH will receive €5.1 billion in newly issued TotalEnergies shares, comprising 95.4 million shares priced at €53.94 each, representing approximately 4.1 percent of TotalEnergies’ capital. Upon completion, EPH will become one of the company’s major shareholders.
The joint venture will oversee industrial operations and development, while each partner will market its share of electricity output through tolling arrangements with the joint venture. The platform includes more than 14 gigawatts of flexible power capacity either operating or under construction and an additional 5 gigawatts of projects under development. This provides TotalEnergies with immediate scale in flexible generation, a critical complement to the company’s extensive renewable energy portfolio as Europe increases reliance on variable solar and wind power.
Italy accounts for 7.5 gigawatts of the portfolio, including highly efficient next-generation gas-fired plants, followed by 7.1 gigawatts in the United Kingdom and Ireland, 3.6 gigawatts in the Netherlands, and 1.1 gigawatts in France. Secured capacity revenues represent forty percent of the gross margin for these assets, positioning TotalEnergies in some of Europe’s most profitable and strategically essential electricity markets. The company expects the additional net production from the portfolio, estimated at 15 terawatt hours per year, to enable the capture of value equivalent to approximately 2 million tons per annum of LNG.
The transaction supports TotalEnergies’ efforts to integrate gas supply and power generation, enhancing the monetization of its LNG portfolio, particularly between the United States and Europe. It also improves the company’s ability to meet the rapidly growing power needs of European data centers and expand its power trading operations.
Financially, the acquisition is immediately accretive to free cash flow per share. TotalEnergies forecasts an increase in available cash flow of about $750 million annually over the next five years, exceeding the dividend requirements of the newly issued shares. The Integrated Power segment is now expected to deliver positive free cash flow and contribute to shareholder returns as early as 2027, rather than 2028. The deal boosts the segment’s projected return on average capital employed from 10% to 12% over the next five years.
Because the acquisition accelerates inorganic growth, TotalEnergies is lowering its annual net capital expenditure guidance by $1 billion per year for the 2026-2030 period, now set at $14 to $16 billion annually, including $2 to $3 billion for Integrated Power. The company is maintaining its 2030 electricity generation target of 100 to 120 terawatt hours.
The completion of the transaction is expected in mid-2026, pending receipt of regulatory approvals and consultations with employee representatives.
KEY QUOTES
“This acquisition marks another major milestone in TotalEnergies’ strategy to build an integrated electricity player in Europe. By joining forces with EPH as part of a long-term partnership, we are accelerating the implementation of our Integrated Power strategy and strengthening our ability to provide reliable, competitive, and low-carbon energy to our customers by leveraging the complementarity of our renewable and flexgen portfolio. Given our position as the #1 gas supplier in Europe, this transaction enables us to fully capitalize on gas-to-power integration and create added value for our LNG chain, independently of oil cycles. We are convinced that this partnership will create lasting value for our shareholders and are also pleased to welcome a new long-term European shareholder who is fully committed to TotalEnergies’ transition strategy.”
Patrick Pouyanné, Chairman And CEO, TotalEnergies
“This transaction is founded on our strong appreciation of TotalEnergies, its management team led by Patrick Pouyanné and its strategy. For all these reasons, we are both highly interested in becoming a long-term anchor shareholder of TotalEnergies and excited to create a joint venture which is already today a leading player in European flexible power generation, best positioned to further strengthen its role. TotalEnergies is one of the largest European companies across all industries and also has a strong global presence. Through the shareholding in TotalEnergies, we are implementing our strategic ambition to diversify our geographic exposure, currently concentrated in the EU and UK.”
Daniel Kretinsky, Chairman Of The Board, EPH
