Urenco restructuring collapses as German owners block deal

* E.ON, RWE (LSE: 0FUZ.L - news) refuse to agree to deal which prevents IPO

* Still plan to sell their third, open to further talks

* E.ON, RWE open to further talks (Recasts, adds reaction from E.ON/RWE, context)

AMSTERDAM/FRANKFURT, Nov 1 (Reuters) - Talks to restructure Urenco broke down after German utilities E.ON and RWE (Amsterdam: RW6.AS - news) , which hold a third in the uranium enrichment firm, refused to agree to a deal that would have prevented a lucrative stock market listing in the future.

Negotiations with the Dutch and British governments, which also own a third each, have been going on for years, but the complex ownership as well as concerns over its sensitive technology have made any deal difficult to reach.

Urenco, the world's second largest nuclear fuel vendor after Russia's Tenex, could fetch up to 10 billion euros ($11.03 billion), sources have told Reuters. Its technology could be used to make a nuclear bomb.

Dutch Economic Affairs Minister Henk Kamp said E.ON and RWE declined to sign an agreement creating a new corporate and legal structure for Urenco because it excluded the possibility of a future stock market listing.

The agreement would have allowed Britain to sell its one-third stake, while the Netherlands would have remained a one-third owner, Kamp said in a letter to parliament dated Oct (HKSE: 3366-OL.HK - news) . 31 and seen by Reuters on Tuesday.

"We could not agree to a structure that would negatively impact the value of Urenco and would have made a sale virtually impossible," E.ON and RWE said in emailed comments, adding they still planned to sell their stake.

"We are open for further talks," the companies said, adding that it would take a long time to complete the sale.

The British government is assessing its options, a spokesman for the Department for Business, Energy and Industrial Strategy said.

Urenco was created more than 40 years ago through the Treaty of Almelo, which requires each country to protect the company's enrichment technology. ($1 = 0.9069 euros) (Reporting by Toby Sterling and Christoph Steitz, additional reporting by Karolin Schaps in LONDON, editing by Jane Merriman and Louise Heavens)