Berlin  - Germany's third largest electricity generating company EnBW will take a 26-per-cent stake in EWE, a smaller rival based in the north of Germany, EWE announced Thursday.

The deal, which has yet to be approved from competition authorities, is reported to be worth about 2 billion euros (3 billion dollars).

EnBW, which is based in southwestern Germany with headquarters in the city of Karlsruhe, is 45-per-cent owned by France's EDF. It achieved turnover of 14.7 billion euros last year.

EWE, which has operations in the north and in Poland, showed turnover of 4.7 billion euros last year. (dpa)