VERBUND booted out deliberately in KEH sale

5/23/2001Wien

As early as at the beginning of April VERBUND presented a binding offer to buy a 49 percent interest in KEH at a price of 4.5 billion ATS. It was linked to the guarantee of a full consolidation of Kelag in the VERBUND group.

Together with the 35 percent of shares in Kelag which VERBUND owns already a majority shareholding would have resulted for VERBUND in Kelag, the operative KEH subsidiary.

Since such an approach would have required an extremely complex and not very transparent set of agreements, VERBUND representatives and the KEH management team and its financial and legal consultants agreed in meetings held on May 5th and 6th this year that aiming at a 51 percent majority interest in KEH was clearly a straighter and therefore preferable solution. The guarantee demanded by the Carinthian Provincial Government to secure Kelag as a place of business headquartered in Klagenfurt and to secure the jobs was also furnished in the VERBUND bid.

VERBUND was obviously and deliberately booted out in the bidding process for the shares in the Kaerntner Energieholding company (KEH). This explains why the Carinthian Provincial Government, contrary to the outcomes of the meetings with the KEH-executives mentioned above, now claims that the VERBUND offer to buy a 51 percent interest in KEH fails to fulfil the bidding requirements and is therefore not relevant.

That the Carinthian Provincial Government opted for the German energy group RWE and against VERBUND, one of the largest producers of clean hydroelectric power, disposes of the justified demand of many politicians for the establishment of a big, Austria-wide water power group.