MVV will acquire its shareholding interest in Juwi through a capital increase. Both the firms did not disclose the financial terms of the transaction, which is expected to be completed by the end of 2014.
Juwi, which was established in 1996, provides project development services and products for the energy industry.
The company has to date deployed around 770 wind turbines with capacities of about 1,600MW at over 100 locations.
It has also installed over 1,500 PV systems with total capacities of about 1,400 MW. The energy systems generate a combined total of approximately 5.5 billion kWh of energy per year.
MVV Energie CEO Georg Müller said the new participation represented a major step for the Mannheim-based group of companies within its MVV 2020 strategic realignment launched in 2009.
"The transformation currently underway in the German energy supply is all about combining renewable and conventional energies as key pillars of the future energy system in a way that makes both economic and ecological sense."
Juwi founders Fred Jung and Matthias Willenbacher will hold a combined 49.9% stake in the company upon completion of the transaction.
Jung and Willenbacher said: "We are delighted to be teaming up with Mannheim-based MVV Energie AG, which is already extremely active in the field of renewable energies and is now interested in the sustainable and strategic expansion of this commitment together with us."
Juwi, which currently employs about 1,000 people globally, has generated annual sales of about €1bn in recent years.
