EC gives green light to energy take-over
26 April 2006, MADRID – The European Commission has approved the bid by German energy giant E.ON to take over Spain's largest electricity firm, Endesa.
26 April 2006
MADRID – The European Commission has approved the bid by German energy giant E.ON to take over Spain's largest electricity firm, Endesa.
The Commission said the union of the two companies would not damage competition in the energy market since the only countries where the pair currently compete with each other are France, Italy, Germany and Poland – and there they only do so in a limited way.
Nor does the Commission think the merger could damage potential competition since it said there was no likelihood of E.ON entering the Spanish market on its own in the near future.
E.ON's president Wulf Bernotat welcomed the news, pointing out that the Commission had approved his firm's bid – which amounts to EUR 29,000 million – without any conditions at all.
The approval "represents one of the main steps in the process of the offer and contributes to the vision of the European Union to develop a pan-European energy market", said Bernotat.
The Spanish government has repeatedly made clear it is unhappy about the German company taking over Endesa and would prefer the Catalan company Gas Natural to take over, forming one large Spanish energy group.
The minister for the economy, Pedro Solbes, said the government had "nothing to object" to the Commission's announcement, but pointed out that the proposed take-over still has to be authorised by Spain's National Energy Commission, the CNE.
Brussels has already warned it is unhappy about the way Spain has expanded the powers of the CNE in response to the German take-over.
Announcing its decision over the E.ON-Endesa union, the Commission stressed it had received evidence from energy companies that Spain and Germany were not properly opening up their energy markets to fair competition. It said it would be monitoring the situation closely.
At the end of last week, the Supreme Court suspended Gas Natural's EUR 22.4 billion hostile takeover bid for Endesa, which it lodged in September, and which was 29 percent less than that of E.ON.
[Copyright EFE with Expatica]
Subject: Spanish news