Series Title | European Voice |
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Series Details | 02/10/97, Volume 3, Number 35 |
Publication Date | 02/10/1997 |
Content Type | News |
Date: 02/10/1997 EVEN as their energy ministers were resisting electricity liberalisation, state-owned utilities in France, Spain and Italy were making plans to muscle into foreign markets that were being prised open. Endesa, the Spanish utility, has led the overseas drive, with a string of multi-billion-ecu acquisitions in Latin America which have given it key stakes in companies in Brazil, Bolivia and Peru. And there is no sign of a slowdown yet. In August, it paid 1.17 billion ecu for a 26&percent; holding in Enersis, a Chilean power conglomerate. In September, it led a consortium which paid 1.9 billion ecu for Colombia's two leading utilities. This month, it is expected to clinch a 1.8-billion-ecu deal for a stake in the main distribution company in São Paulo. Another Spanish group, Iberdrola SA, recently led a consortium which acquired 65&percent; of Coelba, a state-owned Brazilian utility, for about 1.44 billion ecu. The overseas expansion by Mediterranean utilities reflects fears of a foreign invasion of their domestic markets, where demand is growing by barely 1-2&percent; a year and tariffs are declining. Growth rates in Latin America, by contrast, are running at 8&percent; and cash-strapped governments are privatising the entire industry. But some firms are nevertheless concentrating on fending off competition on their home turf, with Italy's ENEL forging a 2.7-billion-ecu power-generating venture with Enron, a Houston-based utility, to tap openings in Europe. The deal will also allow Enron free access to the Italian market in 1999, giving the US industry its first foothold in the Mediterranean. Electricité de France has been one of the most vociferous critics of the EU's liberalisation campaign, but this has not stopped it from making foreign acquisitions in countries as far apart as Brazil and Sweden. |
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Subject Categories | Business and Industry, Energy |
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