ON considers premature to speak on the subject

It is perhaps not a rout, but this is undoubtedly a defeat for the Spanish Socialist Government chaired by José Luis Rodríguez Zapatero: if he accepts the 19 conditions dictated Friday by the National Commission of Spanish energy (CNE), the "giant" electric and gas German E.ON may assume control of one third of the Iberian electricity sector, through the purchase of Endesa, which has an installed capacity of 46.500 MW, including 23.500 MW in the peninsula. Unless the other candidate, the catalan gas Natural Gas (NG) who, with the blessing of "Socialist power", was the first to launch a tender offer (OPA) on Endesa, decides the German challenge.

In this case, GN should also accept the terms of the CNE (sale of assets of transport and distribution of gas and electricity of Endesa to approximately 8 billion euros) and especially put on the table 6.5 billion, only to fall to the German offer of EUR 29 billion. In the meantime, it is estimated in Madrid that the best position to take the case is E.ON, conditional, inter alia, to assign 7.600 MW of capacity of Endesa in the Peninsula: success of its offer, the German group should renounce entries and the management of Endesa in nuclear power plants to Ascó, and Vandellós Almaraz, which the CNE are "strategic assets that should remain under national control." auction power plants of Andorra-Teruel, Compostilla and Anllares that work with Spanish coal funded; and waive (Canary Islands, Balearic Islands, Ceuta, Melilla) island markets where Endesa operates under a special regime of monopoly.

Power of guardianship

"The problem with E.ON, say experts, is that the assets to which he should renounce represent 15 of the Endesa group and especially to provide 40 of the gross operating income. Similarly, should still that the German company maintains "duly capitalized" Endesa, that the financial cost of debt is less than 5.25 operating margin and that remuneration of shareholders is conditioned to 2010, the investment plans of the group, especially in the regulated activities of transport and distribution of gas and electricity.

Would in addition, the NEC reserve during ten years a power of guardianship on any restructuring of Endesa (sale of participations and subsidiaries) and especially warns that in the event of sale of 50 of E.There, he should leave the ownership of the Spanish group. "The CNE made the decision that was required, under the point of view of national and Community law," said the Minister of economy and finance, Pedro Solbes. While his colleague in the industry, José Montilla, ostensibly supported the GN OPA and organized the resistance of the NEC against the German offer, Pedro Solbes was the Government's leading advocate of a "compromise solution". To do this, José Luis Rodríguez Zapatero has appealed to the services of the former Minister of the economy Carlos Solchaga, who played a role of "intermediary" in negotiations with German Chancellor Angela Merkel.

In short, without losing control of the trial, José Luis Rodríguez Zapatero sought to prevent at all costs the case ends in Brussels, before the competition authorities, which were already on alert.

The anger of the German

With the conditions laid down by the CNE, E.ON was that very few comments. "The Group received late Thursday night an oral notification by the NEC of the key decision points and has not yet received the written decision", said the German electrician. Noting that the CNE asked a number of conditions, including the assignment of 7.600 MW of production capacity of Endesa in Spain (inter alia), the Group has not hidden his anger: "E.ON sees no justification for the conditions which he had knowledge and considering all legal options", he continued.

Lawsuits are possible, particularly at the level of Brussels, but E.ON considers premature to speak on the subject. "The CNE report is large and the group does highlight that next week after completing its analysis", said a spokesman for the group.