Friday March 21, 11:07 AM
France's EDF, ACS to move into Spain energy sector
MADRID (AFP) - French power giant EDF (Paris: FR0010242511 - news) will join forces with Spanish construction company ACS (Madrid: ACS.MC - news) to take over Iberdrola (Madrid: IBE.MC - news) and Union Fenosa in massive deals worth 100 billion dollars (64 billion euros), the Wall Street Journal reported on Friday.
If debt is included, the two deals could be worth a combined 134 billion dollars as Spain's power sector is dramatically reshaped, the newspaper said, citing informed but unnamed sources.
EDF and ACS have previously said they were interested in working together in Spain and acknowledged talks about the future of Iberdrola, the country's second largest power group.
ACS holds more than 45 percent of Union Fenosa, ranked third in Spain, and has a direct 7.7 percent of Iberdrola, with options on another 5.2 percent stake.
The WSJ said that although a deal was far from agreed, the outline plan was for EDF to buy the ACS stake in Union Fenosa while ACS would in turn acquire Iberdrola, which would then be broken up with some parts going to EDF.
The French energy company would in particular acquire the holding in Britain's Scottsh Power which were acquired by Iberdrola in 2007.
The newspaper also said another scenario might see German power giant EON (Xetra: 761440 - news) involved, given that in 2006 it had tried to acquire Spain's Endesa (Madrid: ELE.MC - news) . In this case it would be EON which would acquire Iberdrola and then break it up.
Iberdrola has been one of the most active Spanish power companies in recent years, building up a large presence in renewable energy alongside an important foreign portfolio.
Iberdrola has expressed strong opposition to EDF's approaches and only last week launched another protest with the European Union over French government support for its foray into Spain.
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