E.On, the German energy group, moved closer to throwing in the towel over its stymied €41bn (£27.9bn) bid to takeover Spanish rival Endesa as its chief executive admitted it could walk away or settle for a minority stake.
Wulf Bernotat, announcing a 12% jump in operating profits last year to €8.2bn, said the group could "abstain" or take a minority stake in Endesa in the face of substantial stake-building by Italian competitor Enel and Spanish construction company Acciona who together control 43% of E.On's target.
Wulf Bernotat, announcing a 12% jump in operating profits last year to €8.2bn, said the group could "abstain" or take a minority stake in Endesa in the face of substantial stake-building by Italian competitor Enel and Spanish construction company Acciona who together control 43% of E.On's target.
Mr Bernotat, who declined to say how much of a stake his group could finally accept, is under pressure from investors and analysts to decide one way or the other on the year-long battle for Endesa after losing out on an earlier bid for Scottish Power in late 2005. Some observers believe he may be eyeing Scottish & Southern Energy instead.
Enel, which says it wants to build its stake in Endesa to up to 24.9%, has rejected suggestions it is co-operating with the Spanish group, Acciona and Madrid's socialist government in building up its stake, claiming that the Spanish power market is opening up and Endesa has attractive assets. But the Spanish government, which opposes the E.On bid, clearly favours its approach.
The outcome of this bidding war for Endesa and of the stalled merger between Suez and Gaz de France is critical to the formation of a single European energy market, with an EU summit starting Thursday due to decide on a range of measures to foster cross-border power flows and reduce dependence on imported oil and gas.
Mr Bernotat, who has dropped a previous condition of his bid for Endesa, the removal of a 10% cap on voting rights, won a small boost when the European commission threatened Spain with legal action if it did not meet a March 16 deadline to withdraw its own conditions on E.On's bid.
With the EU summit due to debate proposals to break up huge energy groups such as his own, Mr Bernotat offered an alternative plan of co-operation between independent operators of transmission grids and regulators and of a core energy market based around the Benelux countries, France, Austria, Germany and Switzerland.
Enel, which says it wants to build its stake in Endesa to up to 24.9%, has rejected suggestions it is co-operating with the Spanish group, Acciona and Madrid's socialist government in building up its stake, claiming that the Spanish power market is opening up and Endesa has attractive assets. But the Spanish government, which opposes the E.On bid, clearly favours its approach.
The outcome of this bidding war for Endesa and of the stalled merger between Suez and Gaz de France is critical to the formation of a single European energy market, with an EU summit starting Thursday due to decide on a range of measures to foster cross-border power flows and reduce dependence on imported oil and gas.
Mr Bernotat, who has dropped a previous condition of his bid for Endesa, the removal of a 10% cap on voting rights, won a small boost when the European commission threatened Spain with legal action if it did not meet a March 16 deadline to withdraw its own conditions on E.On's bid.
With the EU summit due to debate proposals to break up huge energy groups such as his own, Mr Bernotat offered an alternative plan of co-operation between independent operators of transmission grids and regulators and of a core energy market based around the Benelux countries, France, Austria, Germany and Switzerland.
Source: The Guardian
No comments:
Post a Comment