Italian utility Enel is trying to muscle in on the takeover of Spain’s Endesa. It has bought 9.9% of its shares, which threatens German power firm E.ON’s bid. Enel bought the shares from institutional investors and said it is considering raising its stake to 25.9%.
Chief Executive Fulvio Conti said the purchase is part of a strategy to “strengthen the company’s position in the Spanish and European electricity market.”
Enel together with Spanish investors Acciona and Caja Madrid would control more than half of Endesa’s stock, which is enough to block E.ON’s offer. E.ON responded that it will maintain its offer in the current form.
Analysts believe E.ON will probably now have to pull out and Acciona and Enel may try to break up and share Endesa. That would please the Spanish government which has tried to block E.ON’s takeover to keep Endesa in domestic hands.