Ruhrgas buys into Gazprom
German gas company Ruhrgas has said that it intends to raise its stake in Russian natural gas monopoly Gazprom to four per cent. The announcement came quickly after Ruhrgas` purchase of an initial 2.5 per cent stake for $660m in a privatization auction held in December 1998.
The deal is part of a long term strategy for Ruhrgas, which is looking to strengthen its position in the German energy market. Power generators in Germany are expected to increasingly rely on natural gas as nuclear power is phased out.
Ruhrgas also said that it would extend its current contracts with Gazprom by another ten years to 2030. The sale of another stake would benefit the Russian government which is still struggling under a financial crisis. Ruhrgas paid a premium of $9m over the minimum asking price in the December auction.