RWE issues the Group’s first hybrid bond

Total volume of €1.75 billion. Biggest euro hybrid bond of any company in Europe. End Quote

(1888PressRelease) September 22, 2010 - Yesterday, RWE issued a hybrid bond with a volume of €1.75 billion. This makes it the biggest euro hybrid bond ever issued in Europe by an industrial company. The bond met with keen interest from investors and was soon well oversubscribed.The coupon is worth 4.625% p.a. with an issuance rate of 99.7%.

“This issuance of the first hybrid bond in the history of the Group is a great success for us”, said RWE CFO Dr. Rolf Pohlig after closing the order book, “it gives us additional financial flexibility and also allows us to cover this year’s funding needs in a cost-efficient manner.” At the same time, the hybrid bond provides backing for the capital structure and the rating of RWE without diluting the interests of shareholders.

The hybrid bond is a mix of equity and debt and thus offers a higher coupon than conventional bonds. It theoretically has an unlimited tenor, but RWE does have the right to repayment after a period of five years. The minimum purchase volume for the bonds is just €1,000, which makes them attractive to both institutional and private investors, who will be able to purchase the bonds via their banks. The joint lead managers were BNP Paribas, Deutsche Bank, Goldman Sachs, Morgan Stanley and Royal Bank of Scotland.

This press release does not constitute either an offer to sell nor an invitation to buy securities. The offer is made solely by means of, and on the basis of, the securities prospectus, which is available free of charge at RWE AG. This press release and the information contained in it may not be forwarded to or distributed within the United States. Nothing in this press release constitutes an offer of securities for sale in the United States or any other jurisdiction where it is unlawful to do so. The securities have not been, and will not be, registered under the U.S. Securities Act of 1933 or the securities laws of any state of the U.S. and the securities may not be offered or sold within the U.S. or to, or for the account or benefit of, U.S. persons.

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