Plans to establish a third force in the German utility market to rival RWE and E.ON are well advanced, the finance director of one of the partners, Laubag, told news agency Reuters on Wednesday. Detailed plans for the venture will be ready by the end of the year said Hubert Marbach, but are unlikely to allow for the immediate admission of new partners. Gaz de France (GdF) on Monday said it was studying the possibility of participating.
The new venture, currently called “Neue Kraft” or “New Force”, is forming from Laubag, power producer Veag and Hamburg utility HEW , backed by the Swedish utility, Vattenfall.
“We will probably decide on the basic structure of the holding company and other units this month,” Marbach said. “This will be followed by another building block, the business plan for organisational details such as taxes, finance, locations and communication where we aim for completion by the end of the year.”
The venture was last month weakened by the withdrawal of U.S. company Mirant following a row over interests.
This meant that the retail base offered by Berlin city utility Bewag – in which Mirant and Vattenfall have equal control and ownership – cannot be included, although HEW has left the door open if Mirant changes its plans.
Marbach said GdF or other interested parties could not immediately be accommodated.
“It would be difficult to integrate anyone into the current strategy of creating basic structures very quickly,” he said.
But the addition of gas and perhaps water to make the venture a multi-utility “would definitely be an interesting variation,” he added.
HEW earlier this year finalised the purchase of majority stakes in both Veag and Laubag.
Due to sharply lower coal sales revenue, Laubag has reported a €34.6m ($31.28m) loss for the 2000/2001 year ended June 30, having posted a net profit of €7.7 million in 1999/2000.
But Marbach said the firm would break even in the shortened six-month reporting period up to Dec 31, 2001 – it will be bringing its fiscal year in line with that of HEW/Vattenfall.