Shares in French energy giant Engie jumped sharply on Thursday after the company announced a US$14 billion agreement to acquire a major electricity transmission network in the United Kingdom, boosting investor sentiment and helping push European stock markets higher.
The deal, one of the largest energy infrastructure transactions in Europe this year, underscores growing investor confidence in power grid assets as countries accelerate energy transition efforts and modernise electricity networks.
Engie’s stock rose about seven percent in early trading, leading gains on regional exchanges and lifting utilities across the continent. Analysts said the acquisition strengthens the company’s position in regulated energy infrastructure a sector viewed as offering stable long-term returns amid market volatility.
The broader European market also advanced, with the pan-European STOXX Europe 600 index edging higher by mid-afternoon trading in London. Most sectors traded in positive territory as investors reacted to corporate earnings updates and merger activity.
Market participants said the Engie transaction reflects increasing strategic investment in electricity transmission networks, seen as critical to supporting renewable energy expansion and improving grid resilience across Europe.
Energy infrastructure has become a focal point for utilities seeking predictable revenue streams while governments pursue decarbonisation targets and electrification of transport and industry.
Engie said the acquisition would expand its footprint in the UK’s regulated power network business, providing long-term earnings visibility supported by government-backed tariff frameworks.
The move comes as European utilities reposition portfolios away from fossil fuel-heavy assets toward electricity infrastructure and renewable energy systems.
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Shares of other major European firms also recorded gains during Thursday’s session, including automaker Stellantis and aerospace and defence group Rolls-Royce Holdings, reflecting broader optimism surrounding corporate performance.
Investors have increasingly favoured companies tied to infrastructure modernization, particularly those supporting Europe’s transition toward cleaner energy systems following years of supply disruptions and energy price shocks.
Analysts noted that electricity grids are emerging as one of the most valuable assets in the energy transition, enabling integration of renewable sources such as wind and solar power while ensuring supply stability.
“The market recognises that transmission networks will play a central role in Europe’s electrification strategy,” one London-based utilities analyst said, pointing to rising capital flows into regulated grid operators.
European equities have shown cautious resilience in recent weeks despite uncertainty surrounding global interest rate outlooks and geopolitical tensions, with strong corporate earnings providing support to investor confidence.
The United Kingdom remains an attractive destination for infrastructure investment due to its established regulatory framework and predictable returns for network operators, industry observers said.
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For Engie, the acquisition represents a strategic expansion aligned with its long-term plan to grow low-carbon and infrastructure-based revenues while reducing exposure to more volatile energy generation businesses.
The company has in recent years accelerated investments in renewables, energy services and transmission assets as part of its transition strategy aimed at achieving carbon neutrality while maintaining profitability.
Thursday’s market reaction suggests investors view the UK grid purchase as a financially disciplined move that strengthens Engie’s earnings outlook and reinforces its role as a key player in Europe’s evolving energy landscape.
European markets are expected to remain sensitive to further earnings announcements and corporate deal-making activity in the coming weeks, with infrastructure and energy transition investments likely to remain at the centre of investor focus.
