Gas Natural makes $28 bn bid for Endesa

Gas Natural said it would offer cash and shares worth $28.3 billion to acquire Endesa, a company twice its size. Gas Natural said it was prepared to pay Endesa 21.30 euros ($26.67) per share, 35 per cent in cash and 65 percent in shares. The company planned to hold a news conference Tuesday in Barcelona to give further details of its bid.

Trading in the firms’ shares resumed at midday on Tuesday after they were suspended on Monday, before Gas Natural unveiled its takeover bid for Endesa.

Endesa’s electricity sales have risen in its core markets of Spain and Portugal, as well as elsewhere in Europe. The company’s net profits for Europe outside of Spain and Portugal increased in the first half of this year, with the liberalisation of the Italian market.

For the deal to go through, authorities would have to be reassured the bid was not an attempt by Endesa to actually reverse-acquire the gas company. In 2003, Gas Natural unsuccessfully tried a hostile takeover bid for energy firm Iberdrola.