Holland’s two biggest energy concerns Essent and Nuon finally ended months of speculation today with the announcement that they have signed a principle agreement to merge. The new company will be among the 10 biggest energy concerns in Europe with a turnover of €12bn, five million customers and 20,000 employees in the Netherlands, Belgium and Germany.
But news that the merger will mean the loss of 1,350 jobs has provoked angry reactions from trade unions. The companies said they hope to avoid compulsory redundancies. But this is unlikely, especially in the north where there two companies overlap, the CNV trade union told ANP.
The merger still requires approval from the competition authority and the companies’ local and provincial government shareholders but these are unlikely to make a decision before the provincial elections on March 7.
Essent and Nuon claim the merger will guarantee energy supplies and improve their position on the wholesale market which will have a beneficial affect on power prices. Essent’s current shareholders will own 55% of the new combine which has been given the temporary name EssentNuon.
‘This will create a Dutch combine of significance on an energy market that is undergoing far-reaching changes,’ said Michiel Boersma who will head the new venture. Essent and Nuon believe they can save up to €335m annually as a result of the merger.
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