Spanish Endesa has paid a €1 billion bond in order to endorse a ruling by the Madrid Commercial Court which places a temporary injunction on the takeover bid for Endesa by Gas Natural and the contract between it and Iberdrola for the sale of Endesa assets.
The ruling supports the Endesa contention that serious legal flaws are inherent in the public takeover bid and particularly the agreement with Iberdrola, as this represents an act of collusion by the two companies in an attempt to eliminate Endesa as a competitor and divide its assets, the company says.
Endesa paid the bond to the court as security for possible damages and allows the court to investigate possible collusion. The €1 billion bank guarantee is required regardless of Endesa’s intention to challenge the amount, which they consider to be disproportionate, in the courts.
Endesa reserves the right to claim damages and losses against Gas Natural and Iberdrola, in the event that the existence of an illegal act between the two companies is confirmed.
Pending the court’s final ruling, the measure also effectively sidetracks a rival offer from Germany’s E.On, which has just completed the sub-underwriting phase for the €32 billion syndicated loan to back its plans, the largest ever acquisition financing in Europe.