E.ON Faces Four-Month EU Probe of Bid for Mol's Gas Business
Monday, July 11, 2005, 00:00
E.ON AG's planned acquisition of the natural gas business of Hungary's Mol Rt. for about 2 billion euros (USD 2.4 billion) will get a four-month review from European Union regulators amid concern the company could dominate the Hungarian gas market, business daily Napi Gazdaság reported. The transaction could create significant competition concerns at all levels of the gas and electricity supply chain in Hungary,'' the European Commission, the 25-nation EU's antitrust regulator in Brussels, said in a statement today. E.ON is expanding in Eastern Europe, where economies are growing faster than Germany's. The company already owns two regional gas distributors in Hungary and Mol has options to sell more units to E.ON. E.ON agreed on November 4 to pay 425 million euros and assume 350 million euros of debt to buy 75 % of Mol's storage and wholesale businesses and 50 % of a venture that buys gas from OAO Gazprom. Mol also has an option to sell 75 % of its gas-transport business, worth 1.25 billion euros. Hungary's energy regulator approved the transaction in June with conditions to safeguard against the company abusing its market position.