From question How to replace a character for a newline in Vim?. You have to use \\r when replacing text for a newline, like this
:%s/%/\\r/g
Technical detail:
<Nul>characters in the file are stored as<NL>in memory. In the display they are shown as "^@". The translation is done when reading and writing files. To match a<Nul>with a search pattern you can just enter CTRL-@ or "CTRL-V 000". This is probably just what you expect. Internally the character is replaced with a<NL>in the search pattern. What is unusual is that typing CTRL-V CTRL-J also inserts a<NL>, thus also searches for a<Nul>in the file. {Vi cannot handle<Nul>characters in the file at all}
From vim docs on patterns:
\rmatches <CR>
\nmatches an end-of-line - When matching in a string instead of buffer text a literal newline character is matched.
First of all, open :h :s to see the section "4.2 Substitute" of documentation on "Change". Here's what the command accepts:
:[range]s[ubstitute]/{pattern}/{string}/[flags] [count]
Notice the description about pattern and string
For the
{pattern}see |pattern|.
{string}can be a literal string, or something
special; see |sub-replace-special|.
So now you know that the search pattern and replacement patterns follow different rules.
If you follow the link to |pattern|, it takes you to the section that explains the whole regexp patterns used in Vim.
Meanwhile, |sub-replace-special| takes you to the subsection of "4.2 Substitute", which contains the patterns for substitution, among which is \r for line break/split.
(The shortcut to this part of manual is :h :s%)
Another aspect to this is that \0, which is traditionally NULL, is taken in
s//\0/ to mean "the whole matched pattern". (Which, by the way, is redundant with, and longer than, &).
\0 to mean NULL, so you use \n\n to mean \n, so you use \r.\r to mean \r, but I don't know who would want to add that char on purpose.—☈
From http://vim.wikia.com/wiki/Search_and_replace :
When Searching
...
\nis newline,\risCR(carriage return =Ctrl-M=^M)When Replacing
...
\ris newline,\nis a null byte (0x00).