Snam Drops $1.1 Billion Bid for German Gas Pipeline Operator After Regulatory Pushback

Italy’s Snam has abandoned its $1.1 billion plan to acquire a 24.99% stake in German gas transmission operator Open Grid Europe after Berlin raised concerns over indirect Chinese ownership, ending months of foreign investment review.

(Reuters) — Italian gas grid operator Snam said on Nov. 14 it has scrapped plans to acquire a minority stake in Germany's largest independent gas transmission firm, amid resistance from the German economy ministry.

Berlin's concerns over the 920-million-euro ($1.1 billion) transaction stem from the presence of China's State Grid as an indirect investor in Snam, Reuters reported earlier in the day, citing two sources familiar with the matter.

The Italian group signed a deal in April to buy a 24.99% stake in Open Grid Europe's (OGE) owner Vier Gas Holding from Abu Dhabi's Infinity Investments, aiming to enter the German gas market, the biggest in Europe.

The agreement was terminated after a prolonged foreign direct investment review by Germany, Snam said in a statement, saying its proposed remedies to secure regulatory clearance were found inadequate by the authorities.

The company added that the development will not impact its full-year 2025 financial outlook.

Germany's economy ministry had been reviewing the deal since it was agreed. Its resistance reflects European governments taking a tougher stance against Chinese investment in Europe due to security concerns.

Snam would not pursue the acquisition "come hell or high water" amid the lengthy approval process, CEO Agostino Scornajenchi previously signaled.

Germany blocked an attempt by China's State Grid to buy a stake in power grid operator 50Hertz in 2018.

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