A Spanish commercial court has ordered Electricité de France to clarify its intentions toward Iberdrola, the owner of ScottishPower, after months of speculation that the French power company is planning to make a takeover bid for its Bilbao-based rival.
In a ruling dated Tuesday of this week, the mercantile court of Bilbao said EDF should declare if it had started to buy or planned to purchase Iberdrola shares or securities convertible into stocks.
The court also demanded that EDF, Europe's biggest utility, declare if it was trying to buy Iberdrola with a third party and if it planned to break up Iberdrola. Some energy industry analysts believe ScottishPower would eventually fall into EDF's hands.
During the past few weeks, several French and Spanish newspapers have reported that EDF has been in talks with the ACS construction group - Iberdrola's main shareholder - about bidding for the company and splitting it up between them.
Earlier yesterday, the Spanish financial newspaper El Economista said Iberdrola is trying to overturn a decision by the country's energy watchdog CNE that could allow ACS to acquire a bigger stake in the power firm.
El Economista said Iberdrola has asked the Spanish ministry of industry to reverse the Comisión Nacional de EnergÃa's decision not to limit the voting rights of ACS - Actividades de Construcción y Servicios - and prevent the construction firm from lifting its stake above 10%.
El Economista said Iberdrola's chairman and chief executive, Ignacio Sanchez Galan, is trying to block the head of ACS, Florentino Pérez, from mounting a takeover bid with EDF for the energy company. Shares of Iberdrola dipped yesterday to 10.39.
Spanish industry sources said Galan and Pérez are arch business rivals. In 1993, Pérez was named chairman of OCP Construcciones. After the merger of OCP with Gines y Navarro into Actividades de Construcción y Servicios in 1997, he became head of the company. Pérez is a former chairman of Real Madrid FC.
Elsewhere in the power sector, shares in British Energy rose as much as 3% as traders cited market rumours of an 800p-a-share bid from Centrica for the Scottish-based nuclear power supplier.
British Energy shares later fell back as the rumours faded and closed half a penny, or 0.1%, down at 660p, while Centrica stock ended the session a quarter of a penny, or 0.1%, cheaper at 301.75p.
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