cnn news audio - 13.03.2018

A major asset swap in the German energy sector lifted Europe stocks Monday, as two behemoths of the industry restructured their firms to adjust to the current political climate.

Green energy business Innogy, separated from parent company RWE and publicly listed in 2016, is to be broken up. Under the terms of the deal, which has been agreed in principle and was announced Sunday, RWE will sell its 76.8 percent stake in Innogy to German rival E.ON. In turn, RWE will take on the renewables businesses of both E.ON and Innogy.

The implications of the deal are set to be wide ranging, and come within the context of Germany's energy transition. The country is looking to increase its use of sources such as wind and solar while at the same time moving away from nuclear power. In 2016, renewables made up 29 percent of gross electricity generation in the country, with wind power, biomass and solar photovoltaics leading the way.

Deepa Venkateswaran, a senior analyst in European utilities at Bernstein, told CNBC that the deal represented a reversal for RWE after the IPO of Innogy.