Dutch utility Delta wins court case Borssele-I and announces Borssele-II
A court in Arnhem, the Netherlands, has ruled that Germany's RWE cannot acquire Essent's 50% stake in the Borssele nuclear power plant as part of its takeover of the Dutch utility.
Meanwhile, Delta, Borssele's co-owner, has mooted plans to build a second nuclear power station nearby.
In January, RWE and Essent announced an agreement on the terms and conditions for a binding, all cash offer for the German power company to buy all the issued and outstanding shares of Essent for 9.3 billion Euro (US$12.3 billion). Essent's power plant portfolio includes gas, renewables, coal and its 50%-ownership of the Borssele nuclear power plant. RWE's offer for Essent will see the formation of the fourth largest energy supplier in Europe and was to include Essent's half-ownership of the Netherlands' only operating nuclear power plant. However, Delta, owner of the other 50% of the Borssele plant, said in April that it was taking legal steps to prevent RWE taking over Essent's share of the plant. Delta said that the majority of its shareholders had demanded that EPZ - the joint venture between Delta and Essent for the Borssele plant - should remain in public ownership, in line with EPZ's articles of association and the shareholders' agreement. Delta shareholders claimed that Essent must offer its shares in EPZ to Delta, which would ensure that public interests are protected. Delta said that Essent had proposed that the legal ownership of its 50% stake in EPZ should be assigned to the current shareholders of Essent. The economic ownership would then be transferred to RWE. This, Delta claimed, would still give RWE control over the shares by a "back-door route."
In May, Delta announced that it was taking Essent, RWE and Essent's 136 public shareholders to court, claiming that they had acted unlawfully through the way in which the transaction structure of the deal had been specified. On July 10, a court in Arnhem (where Essents headquarter is located) has now ruled in Delta's favour, saying that Essent's shares in EPZ must remain in public hands, as EPZ's statutes stipulate. Essent has not given a reaction yet, saying it has to study the ruling first, but claiming that the deal with RWE is not off the table. The RWE-Essent deal sparkled a fierce public debate on selling public owned utilities, the other large Dutch utility, NUON, at the same time being sold to Vattenfall.
Meanwhile, on June 25 utility Delta announced it had started to apply to build a second nuclear power plant in the Netherlands, which it expects will be operational in 2018. During the presentation of the plans protesters from amongst others WISE and Greenpeace outside Delta’s headquarters in Middelburg (the capital of the Zeeland province) called for all nuclear power immediately to be phased out in the country.
Although public opinion and opinion of political parties is shifting, Dutch government has agreed that no new plants would be built during its mandate, which runs until 2011. It is expected that after the 2011 general elections right-wing pro-nuclear parties will have a majority in parliament, with the extreme right-wing –and extreme pro-nuclear- PVV (Wilders’ Party for Freedom) likely becoming one of the largest parties
Delta expects its request to be handled in the following cabinet period. It has to first submit a draft proposal to the Environment Ministry which will lead to an assessment report. A formal permit request will then follow in 2011, construction will then start in 2013 with first power in 2018, according to Delta.
Boerma said Delta, which is owned by Dutch provinces and local authorities, was looking for strategic partners to join the project for the new plant, which is expected to have a capacity of 2500 MW (in “one or two units”). But, Delta says, no technology has been chosen, although the choice seems to be between the EPR and AP1000. 2500MW is five times the existing 485 MW nuclear reactor, and is about 20% of all installed (electricity) capacity. Delta CEO Boerma added there was enough space around the Borssele site for even more nuclear plants to be an option in the future.
Delta estimates the costs for 2500 MW between 5 billion Euro (US$ 7 billion) Boerma said no decision had been taken on a partner yet, but added that keeping the plant in public hands would be important to ensure safety standards were met.
Sources: Reuters, 25 June 2009 / World Nuclear News, 10 July 2009 / Laka Foundation
Contact: Laka Foundation, Ketelhuisplein 43, 1054 RD Amsterdam, The Netherlands.
Tel: + 31-20-6178 294