Suez, GDF say to study EC's objection to their merger project

French energy utilities Suez and Gaz de France (GDF) said Saturday that they would study the objections raised by the European Commission to their merger project.

"The documents are very long and complex and we need to examine them. It is still too early to give a reaction," a spokesman for GDF said.

A spokesman for Suez said: "We are going to study the documents in good time and we will then reply to the commission".

But both companies remained optimistic about their merger.

"We have presented a merger project that is profoundly pro- European and pro-competition and we will find the arguments to convince the commission," Suez's spokesman said.

The GDF's spokesman said: "We are still confident that our project to merge will succeed. It is a good project both for France and for Europe."

The French Finance Ministry refused to give any comment on the issue. French Finance Minister Thierry Breton said Thursday that France has faith in the European Commission's work, which would see the birth of another energy giant facing French utility Electricity of France (EDF).

The European Commission confirmed Saturday it had transmitted to Suez and GDF its objections to their merger project, notably the effect it could have on electricity and gas markets in Belgium and France.

The fusion project was handed over by the French government in February as a way to prevent a takeover bid for Suez by Italian group Enel.

In June, the government presented a plan to cut its 80-percent stake in GDF to 34 percent. GDF would then be free to take over Suez, forming Europe's biggest gas group and the fifth biggest electricity producer in Europe.

According to the Belgian authorities, the possible merger would control more than 90 percent of Belgium's electricity market.

Suez and GDF must propose solutions to resolve the anti- competition issues before the commission gives its formal ruling on the merger, due on October 25.

Brussels' green light is one of the major obstacles for the two groups, with that of the French parliament that will begin the debate on Sept. 7 on the law bill allowing the fusion of the state- owned GDF.

Source: Xinhua