KKR, the US private equity expert had joined up with Kuwait Petroleum Corp's international unit to formally bid for RWE's oil and gas unit DEA RWEDE.UL. The German utility firm's energy unit was being offered to the market and the bid was confirmed by four sources familiar with the transaction.

RWE, burdened by loss generating power plants while experiencing rewards in the renewable energy market, is currently EUR35 billion or USD47.2 billion mired in debt. Last March, it had announced it would be selling DEA to raise saiving it could reinvest instead into energy exploration and production.

The Kuwaiti Foreign Petroleum Exploration Co or KUFPEC has been scouting for overseas acquisitions in order to expand its energy portfolio. It has entered into a partnership agreement with KKR for the unit, which is projected to be worth EUR5 billlion according to sources who sought anonymity as the matter is still private in nature.

According to one banking source located in the Middle East, "It's a pretty large asset and it makes sense for a private equity to team up with a strategic (partner). They are currently in active discussions with banks to appoint an adviser."