Spain's Endesa acquires two Dutch energy firms

Spain's Endesa SA has agreed to acquire two Dutch energy companies, NV Nutsbedrijf Regio Eindhoven (NRE), a municipally owned Dutch electricity distributor, and NV Gasbedrijf Regio Eindhoven (GRE), a municipally owned gas distributor, for about 400 million euros.

Jun 22nd, 2000


Spain's Endesa SA has agreed to acquire two Dutch energy companies, NV Nutsbedrijf Regio Eindhoven (NRE), a municipally owned Dutch electricity distributor, and NV Gasbedrijf Regio Eindhoven (GRE), a municipally owned gas distributor, for about 400 million euros.

Both companies operate near Eindhoven. As a result, Endesa will become the largest foreign electricity and gas distributor in the Dutch market, subject to approval by the Dutch Ministry of Economic Affairs.

NRE has about 100,000 electricity customers and GRE has about 175,000 gas customers. In addition, NRE operates the water network in the Eindhoven area under contract and undertakes electricity and gas installations.

Endesa said the acquisition reflects the company's strategy of increasing its presence in the European energy market outside Spain. The companies have a significant strategic advantage, Endesa said, since they supply energy to a highly industrialized area and operate in The Netherlands, which has excellent connections to major European electricity and gas networks.

Through the purchase of NRE and GRE, Endesa will acquire a significant client base and will be well placed to develop experience in the deregulating Dutch market, the company said. Endesa said the acquisition will enhance its joint electricity trading venture with Morgan Stanley Dean Witter & Co., established to develop a trading presence in the European market.

In addition, the purchase complements Endesa's activities as a shareholder in the Amsterdam Power Exchange, an electricity pool for Dutch, German, and Belgian companies. Endesa owns 10% of the consortium that has been awarded the right to design and implement the wholesale electricity market in Poland.

It also has interests in two generating companies: Soprolif, France, and Portuguese independent power producer Tejo Energia, a joint venture of the UK's National Power PLC, Endesa, Electricit´┐Że France (EdF), and Electricidade de Portugal SA (EDF)

Between 2000 and 2004, Endesa expects to invest about 3.6 billion euros in Europe. Endesa said its investment in NRE and GRE is expected to be cash generative and will have a positive effect on profitability from the first year.

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