The acquisition of endesa by gas natural: Why the antitrust authorities are right to be cautious

Electricity Journal

Volumn 19, Issue 2, 2006, Pages 62-68

  Barquin, Julian ^a   Bergman, Lars ^b   Crampes, Claude ^c,d   Glachant, Jean Michel ^e,f   Green, Richard ^g,h   von Hirschhausen, Christian ^i,j   Lévêque, François ^k,l,m   Stoft, Steven ^n,o  

^a UNIVERSIDAD PONTIFICIA COMILLAS   (Spain)

^b STOCKHOLM SCHOOL OF ECONOMICS   (Sweden)

^c UNIVERSITÉ DE TOULOUSE   (France)

^d Toulouse School of Economics   (France)

^e UNIVERSITÉ PARIS SACLAY   (France)

^f ADIS Research Center

^g UNIVERSITY OF BIRMINGHAM   (United Kingdom)

^h Institute for Energy Research and Policy   (United Kingdom)

ⁱ DRESDEN UNIVERSITY OF TECHNOLOGY   (Germany)

^j DIW BERLIN   (Germany)

^k PSL RESEARCH UNIVERSITY   (France)

^l Ecole's Research Center in Industrial Economics

^m UNIVERSITY OF CALIFORNIA   (United States)

ⁿ Pjm   (United States)

^o California Electricity Oversight Board   (United States)

more..

Author keywords

[No Author keywords available]

Indexed keywords

MERGERS AND ACQUISITIONS;

ANTI-TRUST AUTHORITIES; ELECTRICITY SECTOR; MERGER CONTROL; MERGER REMEDIES; STRINGENTS;

MERGING;

EID: 32944471725     PISSN: 10406190     EISSN: None     Source Type: Journal    
DOI: 10.1016/j.tej.2006.01.002     Document Type: Article

References (16)

1. Tribunal de la Defensa de la Competencia, Informe - Expediente de Concentration Economica C94/05 Gas Natural/Endesa, Madrid, Jan. 5, 2006.
2. The article results from research based on publicly available information. The research was financed by Endesa with the funds contributed to non-profit research organizations and foundations. The paper, however, only reflects the views of the authors. A longer version of the article, including insights on the potential anticompetitive horizontal and vertical effects, is available at http://www.cerna.ensmp.fr.
3. M.-K. Codognet, J.M.Glachant, F. Lévêque and M.-A. Plagnet, Mergers and Acquisitions in the European Electricity Sector: Cases and Patterns, Cerna, 2003, available at http://www.cerna.ensmp.fr/Documents/ FL-MA-MAsEU-Cases-2003.pdf.
4. For example, the German and Swiss T-Power is going to build in Belgian Flanders a 400 MW plant; it could purchase gas from Norwegians or from Germans thanks to the gas hub of Zeebrugge.
5. See D. Newbery, The Relationship between Regulation and Competition Policy for Network Utilities, paper presented at Conference in Tribute to Jean-Jacques Laffont in Toulouse, France, on June 30, 2005.
6. In the medium term, the focus should be kept on the expansion of transmission capacities, both for electricity (Spain-France, Spain-Portugal) and natural gas (import pipelines, LNG terminals).
7. Eon's investments in the U.K. are precisely targeted in a market with a rather low concentration level compared to EU standards.
8. Vattenfall is an interesting case to look at. It has quite the same home market share as Endesa in Spain (roughly half the market), but the Swedish electricity market is actually smaller than the Spanish market and Swedes barely consume gas. All this did not stop Vattenfall from entering half a dozen foreign countries, while it was unable to deter in Sweden the entries of the Finnish operator Fortum (through an investment in Stockholm Energy) and of the German operator E.ON (through an investment in Sydkraft).
9. J.-M. Glachant and F. Lévêque, Electricity Internal Market in the European Union: What to Do Next? MIT-CEEPR Working Papers 2005-015, available at http://web.mit.edu/ceepr/www/workingpapers.htm.
10. S. Stoft, Power System Economics: Designing Markets For Electricity (IEEE Press, 2002).
11. J. Anderson, Making Operational Sense of Mergers and Acquisitions, Elec. J., Aug.-Sept. 1999, at 49-59.
12. J.R. Becker-Blease, L.G. Goldberg and F.R. Kaen, Post-Deregulation Restructuring of the Electric Power Industry: Value Creation or Value Destruction?, Feb. 26, 2004, available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=625083.
13. M. Motta, Competition Policy: Theory and Practice (Cambridge, U.K.: Cambridge University Press, 2004).
14. M. Motta, M. Polo and H. Vasconcelos, Merger Remedies in the European Union: An Overview, in Merger Remedies in American and European Union Competition Law, F. Lévêque and H. Shelanski, eds. (Cheltenham, U.K.: Edward Elgar, 2003), at 106-128.
15. Newbery, supra note 4.
16. Federal Trade Commission, Bureau of Competition, A Study of the Commission's Divestiture Process, Aug. 6, 1999, available at http://www.ftc.gov/os/1999/08/index.htm.