AMSTERDAM – A large majority of the cities who own Dutch energy company Eneco will likely decide to sell their stakes, leading to a privatisation of the country’s largest independent energy company, the chairman of its shareholder committee told Reuters.
The 53 municipalities are due to decide in principle on whether to sell their Eneco stakes by Oct. 31. Depending on the result, shareholders and the company will then begin working out how the sale of Eneco, which is valued at around 2.7 billion euros ($3.16 billion), will proceed.
Adriaan Visser, who is also an alderman for the City of Rotterdam, Eneco’s largest shareholder with 31.7 percent, said most smaller cities would not want to be left in a minority position. Eneco’s top three shareholders – Rotterdam, The Hague and Dordrecht with a total of 57 percent of its shares – have all decided in principle to sell.
“My expectation is that a large majority will move to sell their shares in the end,” Visser told Reuters during an interview at Rotterdam’s city hall.
Eneco’s shareholders have been conducting a strategic review since the company lost a 10-year fight against a government decision ordering it to split its grid operations, Stedin, from its generation business.
Visser said he does not think the Dutch government, which recently opposed foreign takeover bids for paintmaker Akzo Nobel and postal company PostNL, will block a sale to a qualified foreign buyer, despite lobbying against this by Eneco’s board of managers and labour unions.
The Dutch Economic Affairs ministry confirmed on Thursday it has deliberated on what to do about Eneco as well as other large companies with significant renewable energy assets.
“The operation and future of these companies is something this Ministry discusses on a regular basis with all stakeholders,” Economic Affairs Minister Henk Kamp said a response to emailed questions from Reuters.
But he said that in general, the government does not get involved in private market transactions.
“The Netherlands profits from the fact that we have an open economy, an investment climate we want to maintain. Only in extraordinary circumstances is there a duty for the government to get involved.”
Visser said it would be difficult for the ministry to justify blocking a sale of Eneco given it had ordered the company to be split into a public and private arm.
In addition, it did not oppose sales of Dutch generation companies Nuon and Essent, which were purchased by Sweden’s Vattenfall and Germany’s RWE, respectively, in 2009.
“I can imagine the government will talk with us about what kind of party is logical,” Visser said, adding that shareholders have already worked out their own criteria for a suitable buyer.
These included a buyer having stable finances, being a good employer, and being willing to invest in further renewable energy assets.
He said that if the process moves to an auction, it will be on a “nondiscriminatory” basis for qualified bidders.
Eneco spokesman Edwin van de Haar said the company has “no preferences at this stage” as to whether Eneco would be sold to a single buyer or in an initial public offering. ($1 = 0.8548 euros)