Austrian energy giant OMV has finalized a deal to purchase compatriot Verbund for E13 billion ($16.5 billion) in a move that will create the latest in a long list of European energy 'champions'.
Ironically, the development comes at the same time that France and Spain have faced massive opposition to plans to create similar domestic champions. Gallic companies GdF and Suez have been battling EU and Italian opposition to their merger, while Brussels is strongly opposing moves in Spain to combine Gas Natural and Endesa.
OMV is already one of the biggest players in the central European energy sector and following its acquisition of Verbund the combined company will have a market capitalization of around E29 billion, ranking just outside the ten biggest European energy firms.
The new outfit, to be known as OMV Verbund, will have assets spanning the energy sector from oil and gas businesses to energy generation and supply portfolios. For OMV, the merger will strengthen its geographical position in central Europe, while Verbund will gain access to gas supplies to bolster its gas-fired power station expansion plans.
Furthermore, OMV suggests the combination would leave the companies E100 million better off per year.