Germany Opposes Ruhrgas Bid
May. 21, 2002
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BERLIN (AP) _ German energy giant E.On's bid to take over Ruhrgas, the country's largest natural gas distributor, suffered a setback Tuesday when competition experts advising the government said they opposed the deal.
The Monopolies Commission said the takeover could undermine the benefits of deregulating energy markets and permit the company to dictate prices.
Combining the companies' dominant positions in electricity and gas markets would produce ``particularly grave restrictions on competition,'' the commission said in a statement.
E.On, which wants Ruhrgas as part of a drive to take advantage of market deregulation and expand, has asked the Economics Ministry to overturn a decision earlier this year by the Cartel Office, the country's antitrust regulator, to block the deal.
The Duesseldorf-based company wants to assemble a majority in Ruhrgas by buying stakes from oil company BP and Bergemann GmbH.
E.On insisted Tuesday that taking over Ruhrgas would create a strong company able to compete internationally, create jobs and secure gas supplies without damaging competition _ arguments rejected by the commission and the Cartel Office.
E.ON said it would submit comments on the commission's disapproval to the ministry, which plans to decide by early July whether to overturn the Cartel Office's ruling.