Final barriers to merger cleared -- Warning of jobs loss in Denmark

Google Translate

The merger of Vestas and NEG Micon is now free to go ahead following approval from the United States anti-trust authorities on February 23. It was the penultimate regulatory approval awaited from competition authorities in a series of countries. Only Britain's Office of Fair Trading has yet to approve the merger plans, but even if it refused to do so that would not stop the deal from going ahead, says Vestas boss Svend Sigaard.

The company becomes the largest supplier of wind turbines in the world and aims to retain its 35% share of the global wind market. Sigaard has previously said, with reference to Vestas' dominance in Italy, that a high market share is "difficult to defend" (Windpower Monthly, 2003). But at a regional meeting of wind interest groups, coincidentally held on February 23, Sigaard said that Vestas' increased technical and economic strength would make it a winner at serving customers.

The fusion formally takes place March 4 after two postponements for competition authority approval. By February 23, 92% of shareholders in NEG Micon had given their acceptance of an offer to exchange their shares with those of Vestas. A condition of the merger, first announced in December, was the requirement that 66% of NEG Micon shareholders accepted the offer.

For participants at the regional meeting, Sigaard had dismal news. While the merger will result in a future "sharp rise" in employment, that rise will take place outside Denmark's borders. In Denmark, the number of jobs provided by Vestas will continue to fall -- as it has done since the government indicated two years ago that it would not continue to facilitate continued wind power development. Today the country gets 20% of its electricity from wind plant, a percentage achieved faster than national energy policy goals.

"That political declaration means we have to dig deep in our pockets for an explanation each time a potential overseas customer asks why we can't sell wind turbines in Denmark," said Sigaard. "With that policy for renewable energy, I don't believe we'll be allowed to maintain employment levels."

Sigaard expects, however, that a series of core functions will be kept in Denmark. Without mentioning Spanish Gamesa, which has an office mid-way between the Vestas and NEG Micon factories, he referred to overseas competitors with a presence in Denmark, where employees with considerable professional experience in the wind industry can be found.

Have you registered with us yet?

Register now to enjoy more articles
and free email bulletins.

Sign up now
Already registered?
Sign in

Latest news