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dam-l (Fwd) LS: Duke Withdraws Endea bid
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Copies to: patrick@irn.org
Date sent: Thu, 22 Apr 1999 13:45:46 -0700
From: Monti Aguirre <monti@irn.org>
Subject: LS: Duke Withdraws
To: irn-biobio@apc.org
***
CHIP NEWS
****
April 22, 1999
Subject: Duke Withdraws Bid for Endesa Chile
Sources: El Mercurio, El Dario
****
DUKE WITHDRAWS BID FOR ENDESA
CHILE
US-based Duke Energy withdrew its offer
Wednesday for a
controlling share of power producer Endesa Chile,
paving the
way for a competing bid made by power company
Endesa
Spain.
Sources linked to Endesa Spain said Duke's
decision
reaffirms their belief that Endesa Spain's offer, made
through
Chilean affiliate Enersis, an electricity-sector holding
company, is the best option for shareholders and the
country.
Anti-monopoly authorities Wednesday said they
would
investigate the sale to see if the resulting
concentration of
power over the nation's electricity sector represented
a
threat to free competition. They rejected, however,
taking the
stronger measure of suspending the sale of Endesa
Chile.
Endesa Spain, which gained control of Enersis just
this
month after doubling its share in the firm from 32 to
64
percent, now stands to gain control of the largest
power
producer in the nation, Endesa Chile, now that
Duke's offer
now formally off the table. Its purchase of shares in
Endesa
Chile is set for April 29.
Duke had offered 275 Chilean pesos (US$0.58) per
share for
a 60-percent stake in Endesa Chile. That compared
to the
offer tendered by Endesa Spain of 360 pesos
(US$0.76) per
share for 34.7 percent of Endesa Chile to
complement the
25.28-percent stake it already has.
Bruce Williamson, head of the international division of
the
North Carolina-based Duke, said the firm's decision
to
withdraw from the increasingly heated competition for
Endesa Chile stemmed from the lack of support for
its offer,
mainly from the big shareholders, presumably the
nation's
pension fund managers (AFPs).
"Once we realized the numbers weren't there for us,
we
preferred to make the decision to withdraw," he said.
He
added that he felt like "a politician learning of his
defeat on
election night." An Enersis source responded, saying
the
decision shows the Endesa Spain offer "is good."
The
source said the firm "offered a good price" and
moreover,
that the offer leaves a large chunk of Endesa Chile
shares on
the open market, allowing a measure of liquidity of
the firm.
The government watchdog body in economic matters,
the
Fiscalia Nacional Economica, FNE, submitted a
report
Tuesday to the nation's anti-monopoly authorities
recommending that the sale of Endesa Chile be
suspended.
Lawyers Hernan Bosselin and Ramon Briones along
with five
lawmakers had sought the measure.
"We are convinced...that vertical integration is
harmful in the
electricity sector and we aren't going to change our
opinion,"
said Rodrigo Asenjo, the FNE head.
Anti-monopoly authorities rejected the call, however,
though
will investigate the matter to determine if an increase
by
Enersis in Endesa Chile will harm free competition.
The
officials have already asked for more information on
the
matter from the parties involved in order to carry out
the
inquiry.
The end
***
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Monti Aguirre
Latin American Campaigns
International Rivers Network
1847 Berkeley Way
Berkeley, CA. 94703 USA
Phone: 510 . 848.11.55 and 707 . 591 .91.49
Fax: 510 . 848.10.08
e-mail: monti @irn.org
http://www.irn.org
Dianne Murray, Coordinator/Webmistress
Dam-Reservoir Working Group; Ottawa, Canada
Dam-Reservoir Impacts and Information Archive
http://www.sandelman.ottawa.on.ca/dams