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EU criticises french nationalistic merger { March 1 2006 }

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   http://business.timesonline.co.uk/article/0,,13130-2063537,00.html

http://business.timesonline.co.uk/article/0,,13130-2063537,00.html

The Times March 01, 2006

EU criticises 'nationalistic' merger of French utilities
By Carl Mortished, International Business Editor


THE merger of Gaz de France and Suez was given a lukewarm reception in Brussels yesterday as Franco Frattini, the European Commission’s vice-president, described the proposed French mega-utility, with total revenues of €64 billion (£44 billion), as a “blow to the European single market spirit”.

Few further details of the merger, announced hurriedly on Saturday, were available. The partners even fudged the issue of who would head up the new company, refusing to formally anoint Gerard Méstrallet as chief executive.

The merger of the French gas monopoly with Suez, which owns Electrabel and Distrigaz, the dominant Belgian power and gas distributors, was announced only three days after Enel, the Italian utility, hinted at its interest in taking over Suez.

In an effort to deflect attention from the effective privatisation of Gaz de France, the executive management of the merged group is being presented as a joint leadership between M Méstrallet, the Suez chief, and Jean-François Cirelli, the former senior civil servant who heads Gaz de France.

However, insiders conceded that the transaction is a reverse takeover of Gaz de France by the management of Suez.

Signor Frattini, a former Italian Foreign Minister, chided the French Government’s endorsement of the merger, suggesting that EU member states should be “a little more European and a little less nationalistic”.

Unrepentant, Dominique de Villepin, the French Prime Minister, told the French Parliament that the merged company would be an international energy champion, creating jobs and attracting investment.



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