Swedish energy company Vattenfall has issued a bid to purchase shares in the Danish utility Elsam. The offer is addressed to a consortium that pools 67% of the Elsam shares.

Vattenfall’s offer consists of a cash bid with a fixed price of DKK1,250 per share under the condition that the amount of shares sold to Vattenfall exceeds one third of the total number of shares in Elsam.

A second option that was offered to the consortium is based on a fixed price of DKK1,450 per share of which DKK300 per share are conditional to Vattenfall acquiring more than one third of the shares in Elsam, the development of power prices and that Elsam achieves a majority position in the Danish power generation company Energi E2 A/S.

Elsam and Vattenfall are a matching pair. Elsam with its competence in cogeneration and wind-power will be an ideal partner for our common further growth on the Nordic Market. We at Vattenfall have gained a lot of experience on highly competitive markets. We want to use this to the benefit of the Danish customers, said Vattenfall’s president and CEO, Lars Josefsson.

Elsam A/S is Denmark’s leading producer of electricity and heat with activities both within Denmark and abroad. Operating mainly on Jutland and Fyn, Elsam operates coal- and waste-fired cogeneration plants with a total capacity of more than 3,600-megawatts. Its 417-megawatt wind-power generation makes Elsam Scandinavia’s largest wind-power operator.

Vattenfall’s offer comes as a thorn in the side of Danish government plans to merge Elsam with state-owned gas producer Dong A/S. An agreement between Elsam and Dong has been in place since December, however it could still be rejected if Elsam shareholders prefer Vattenfall’s new offer. The Danish political leaders had hoped to maintain domestic control of the countries energy market despite it becoming open to foreign investment.

The Elsam board will meet to consider the offer on Wednesday, following which it will issue its recommendation to Elsam shareholders.