Austrian electricity company Verbund will purchase eight hydroelectric plants from E.ON Renewable in Germany.
The eight hydropower plants are located on the Inn and Danube Rivers and the purchase will enhance Verbund's average annual production by 2 billion kWh.
Verbund will also buy back 200 million kWh of hydro power generation from the Zemm-Ziller group to enhance its renewable energy portfolio.
In exchange Verbund will divest its 50% interest in Turkish firm Enerjisa and the deal is expected to be worth over €1bn ($1.3bn).
Verbund CEO Wolfgang Anzengruber remarked that the company intends to focus on hydropower, majority shareholdings and the Austrian and German markets.
"That is why we are taking the opportunity to expand our hydropower production in Germany, and gain more control over existing investments.
"This transaction strengthens our position as one of the leading producers of hydropower in Europe: among other things, this will raise our electricity generation from run-of-river power plants by 9% and improve our risk profile.
"In addition, it will open up further room for manoeuvre for strategic opportunities," added Anzengruber.