The Spanish government has insisted the conditions it imposed on German company E.ON’s proposed takeover of Spain’s largest power generator Endesa are legal and will not be withdrawn. The European Commission had ordered Spain to withdraw the restrictions by today.
The EU executive, which wants to open up European energy markets and eliminate barriers to cross-border takeovers, warned Madrid may now face legal action.
Spokesman Jonathan Todd said the case could end up in the EU courts: “If the measures are not withdrawn, then we will have the option of opening an infringement procedure against the Spanish government for failure to respect community law, as we did after they failed to respect the previous article 21 decision on this case in September.”
Madrid had originally backed a merger between Endesa and the country’s top gas supplier Gas Natural, hoping to create a national champion in the energy sector to protect the industry from foreign takeover bids.
Gas Natural is reportedly about to give up on merging with Endesa. One major Gas Natural shareholder says it does not have the resources to bid more than E. ON.