European Union regulators approved the merger of French energy firms Suez and Gaz de France (GDF) on Tuesday, clearing the way for the creation of the continent's largest natural gas utility. The European Commission conditioned its approval on the two companies divesting their Belgian gas subsidiaries to protect competition in Belgium's energy sector.
Under the terms, Suez and GDF must sell off Distrigaz and SPE, and Suez must also relinquish control of Belgian grid operator Fluxys. Regulators had worried that the 42.1 billion-euro (54 billion dollar) deal would entrench Suez's already strong position in Belgian energy markets.
France originally arranged the merger in February to block a bid by Italy's Enel, a move that drew an antitrust investigation and criticism from Brussels for violating EU free-market principles. Paris defended the deal as a step toward stronger European energy independence, citing the bloc's reliance on Russian gas supplies.
The Commission has been pushing for a unified pan-European energy market and plans to introduce new legislation aimed at lowering barriers to cross-border investment early next year. EU officials say member governments have been slow to apply single-market rules and have done too little to integrate the fragmented European energy sector.
Historical summary. TurkishPress restated this wire report, first published in November 2006, in its own words.