The City of Hamburg, Germany, is exercising a call option from a 2014 agreement to acquire the city's district heating system from Vattenfall Services Nordic AB.

Vattenfall said in an Oct. 9 news release that it regrets the decision of the city. The sale is scheduled to occur by Jan. 1, 2019.

The contractually agreed minimum price for buying the heat business is €950 million. Adjusting for the share paid by the city in 2012, the actual payment to be made will amount to €625 million.

"To continue as a minority shareholder was not an option for Vattenfall," Tuomo Hatakka, Vattenfall's senior vice president of business area heat, said. Vattenfall currently owns 74.9% of the Hamburg district heating system, and the city owns 25.1%.