Corporate | 1 July 2004 16:01

RWE Makes Bond Tender and Exchange Offer and Optimizes Financial Structure

Corporate-news announcement sent by DGAP. The sender is solely responsible for the contents of this announcement. ——————————————————————————– Essen, July 1, 2004 RWE Makes Bond Tender and Exchange Offer and Optimizes Financial Structure – Swap and buyback of bonds with transaction volume total of up to EUR2 billion o EUR2.5 bn 5.500% RWE Finance BV notes (due October 26, 2007) o EUR2.0 bn 5.375% RWE Finance BV notes (due April 18, 2008) – Two separate tranches including o Exchange into new bond maturing 2014 o Tender offer against cash – RWE Group reduces gross debt even further RWE Finance B.V., a wholly owned subsidiary of RWE AG, Essen, today announced the simultaneous launch of a tender offer to buy back or exchange against a new 10 year bond. The transaction volume amounts to up to EUR2 billion and refers to: o EUR2.5 billion 5.500% notes due October 26, 2007 o EUR2.0 billion 5.375% notes due April 18, 2008. Investors are invited to submit bids for both offers. The new bond will mature in July 2014 and have a benchmark size of no less than EUR500 million. Dr. Klaus Sturany, CFO of RWE AG, commented: “By making this attractive offer to investors, we are taking advantage of the favorable market environment while optimizing our financial structure by further reducing gross debt and stretching the maturity profile of our outstanding bonds.” Cash buyback offer RWE Finance B.V. will accept offers of up to EUR1 billion, the minimum amount being EUR0.5 billion. New bond The new bond which will mature in 2014, will be issued under the existing Debt Issuance Programme, guaranteed by RWE AG and listed on the Luxembourg Stock Exchange. RWE Finance B.V. will accept a maximum of EUR1.5 billion, the minimum being EUR0.5 billion. Timetable Both offers will run simultaneously on an identical timetable. The final spreads for the two offers will be announced on July 8, 2004. Offers will be accepted until 17:00 CEST on July 14, 2004. Pricing for both tranches (cash buyback and new bond) will be on July 15, 2004. Due to legal constraints these offers explicitly exclude investors in the US, Italy, and Spain. Further restrictions are laid out in the offer memorandum. RWE Finance B.V. reserves the right to waive, amend, terminate or withdraw the aforementioned offers at any time. Barclays Capital, Deutsche Bank and HSBC are acting as joint dealer managers for the two offers. ABN AMRO and Merrill Lynch were appointed Co-Dealer Managers. Details of the offers are set out in the offer memorandum dated July 1, 2004. Please direct inquiries to: Bill McAndrews Head of Group Press Relations Phone: +49-201-12-15095 Cell: +49-177-5515302 Michael Rosen Group Press Relations Phone: +49-201-17441 Cell: +49-172-2851858 end of message, (c)DGAP 01.07.2004 ——————————————————————————– WKN: 703712; ISIN: DE0007037129; Index: DAX, EURO STOXX 50 Listed: Amtlicher Markt in Düsseldorf und Frankfurt (Prime Standard); Freiverkehr in Berlin-Bremen, Hamburg, Hannover, München und Stuttgart; EUREX; Swiss Exchange 011601 Jul 04