Austrian power group EVN presses ahead with capital increase
Austrian power group EVN said on Thursday it would press ahead with a planned capital increase even though key shareholder, Germany's EnBW, would not sell a substantial chunk of its shares as part of the deal.
"Energie Baden-Weurttemberg has informed us that they do not approve such a sale. Hence, EVN has decided to take necessary steps to implement a capital increase of up to 10 percent in a new structure," the Austrian utility said in a statement.
Originally, EVN had planned to sell a total 57.3 million shares in a capital increase, comprising 16.4 million shares new shares and 40.9 million from EnBW's existing shareholding.
The German company would have therefore seen its stake cut from 35.72 percent to below 10 percent.
But EnBW decided not to sell, because EVN's asking price of 10.50 euros per share was too low.
The so-called bookbuilding period, where investors can apply for shares within a certain price range to determine the final offer price, closed on Wednesday, with the most offers coming in at 10.50 euros.
"EnBW is of the opinion that the current price does not correspond to the intrinsic value of EVN," the German power group said in a statement released in Karlsruhe.
EVN chief Burkhard Hofer expressed "regret" over the German partner's decision and said the Austrian group would approach investors again to subscribe to the planned issue of new shares.
EVN is 51-percent owned by the province of Lower Austria.
Its shares were among the biggest gainers on the Vienna stock exchange on Thursday, showing a gain of 7.28 percent to 11.94 euros.
© 2010 AFP