FRANKFURT, Aug 19 (Reuters) - German utility EnBW on Friday said it had given state lender KfW a pre-emptive right to buy a 24.95% stake in power grid subsidiary TransnetBW as it seeks to upgrade the network to help reach climate goals.

While acknowledging the need for major investment to ready the grid https://www.reuters.com/markets/europe/enbw-says-it-is-pressing-ahead-with-planned-sale-transnetbw-2022-08-13/#:~:text=FRANKFURT%2C%20Aug%2013%20(Reuters),savings%20banks%20was%20among%20bidders for increased amounts of renewable power, Germany is keen to retain some control over energy infrastructure, especially in the light of supply disruptions caused by the war in Ukraine.

As part of the planned transaction, EnBW is offering two separate minority stakes of 24.95% each via an intermediate entity that is yet to be established, to be sold via an auction process.

KfW, which will not take part directly in the transaction, can exercise its call option to buy one stake at the end of the auction based on the terms that have been determined during the bidding process, EnBW said.

Reuters reported in June that KfW was considering taking a stake in TransnetBW https://www.reuters.com/markets/deals/exclusive-german-bank-kfw-considers-buying-stake-transnetbw-power-grid-sources-2022-06-07, one of Germany's four high-voltage networks that operates a 3,100-kilometre (1,940-mile) grid, citing sources familiar with the matter.

Boersen-Zeitung earlier this week reported that insurance firms Allianz and SV Sparkassenversicherung and asset manager BlackRock were also interested in a stake.

EnBW seeks to invest around 12 billion euros ($12.10 billion) between 2021 and 2025, of which around 6 billion euros would be for electricity and gas networks and around 4 billion euros in renewable energy and fuel switching projects.

The new investment should "support the further expansion of the overall portfolio in a balanced way", it said.

The national grid development plan 2035 identifies nearly 10 billion euros of investment requirements for TransnetBW alone, including the SuedLink and Ultranet projects.

The power lines are needed to connect renewable generation with customers in the industrial parts of the south.

($1 = 0.9918 euros)

(Reporting by Vera Eckert and Christoph Steitz; Editing by Rachel More, Miranda Murray, Barbara Lewis and Jan Harvey)