Goldman Sachs Group Inc. has been encouraging hedge funds to bet that Germany will be able to pull off an increasingly tricky takeover of the country’s biggest power grid valued at over €22 billion ($24 billion).

The bank has been offering to sell bonds issued by state-owned Dutch grid operator Tennet Holding BV in the last few weeks, when they were trading in the mid-80s, people with knowledge of the matter said. It’s flipping some notes to hedge funds by dangling the prospect of quick profits, telling them Tennet’s bond documentation indicates the securities might be redeemed at 100 if a transaction goes through, they said.

“Once the deal is announced, the Tennet bond-complex could be one of the largest rate-of-return situations in Europe,” Goldman wrote in a sales trading note this month. Several of Tennet’s bonds have language around “issuer substitution” that may trigger a change of control and repayment at their full value, according to the note.

A representative for Goldman declined to comment.

Germany has been in talks with the Dutch government over a purchase of Tennet’s local grid for nearly a year and has agreed in principle on the main terms, people familiar with the matter said. The negotiations have become increasingly fraught in recent days, however, as the German budget crisis deepens.

The Netherlands is holding federal elections Wednesday, effectively bringing an end to the country’s current caretaker government. Meanwhile, German officials are scrambling to work out the implications of a Constitutional Court judgment calling into question hundreds of billions of euros of financing in special funds, people with knowledge of the matter said. Put together, it’s unlikely any deal will be reached this year, according to the people.

The finance ministry in Berlin on Monday froze virtually all new spending authorizations for this year as it tries to identify the court ruling’s longer-term implications, government officials have said. Existing liabilities will be honored but new commitments can be unblocked only in exceptional cases, they said.