Nuon bid

State-owned Swedish utility Vattenfall has made an €8.5bn (£7.4bn) all-cash offer for the production and supply business of Dutch energy-firm Nuon.

Subject to shareholder and regulatory approval, Vattenfall will initially buy 49 per cent of the shares, with the remaining 51 per cent to be acquired in the next six years.

The payout of dividends is expected to bring the total cost of the acquisition to €10.3bn.

Vattenfall’s chief executive, Lars Josefsson, said that the acquisition is a strategic move to strengthen the group’s foothold in the European energy market and extend its gas operations.

The companies have also stated that off-shore wind and carbon capture and storage (CCS) projects will remain central to the strategic goals of the newly merged group, which aims to be climate neutral by 2050.

Øystein Løseth, chief executive of Nuon, said: ‘Together, Vattenfall and Nuon have the scale to continue securing reliable, affordable and clean energy.

‘Nuon and its shareholders have been working closely together over the last months in selecting the partner with the best fit.

‘We have also been able to secure the public interest by forming a foundation.

‘I'm very pleased to say that in Vattenfall, Nuon has found a partner that enables the company to continue pursuing the current strategy and realise our objectives.’

Nuon's head office in Amsterdam and regional offices will be kept at their current locations.

Vattenfall said that there will be no job cuts as a result of the takeover, which is expected to close by the end of the second quarter of 2009.