Liberalisation of the electricity markets in the UK and Scandinavia has driven merger activity in these territories. This was evident in 1996 with U.S. companies taking over MEB, East Midlands Electricity and Northern Electric, with London Electricity likely to follow in early 1997. There could have been more, but intervention from the regulatory authorities prevented National Power from being acquired by Southern Company.
In Scandinavia, the combined electricity market of Sweden and Norway may be suffering from several problems, but that has not prevented the major players from increasing their market share through acquisition. Finland's IVO now controls Gullspang Kraft, Sweden's fourth-largest generator, and the number of distributors in Sweden continues to decline, with deals such as Sydkraft's acquisition of Orebro Energi.
Elsewhere in Europe, the passing of the EU Directive on the liberalisation of electricity markets is affecting industry consolidation. In Spain, the Spanish Government has approved Endesa's acquisition of controlling stakes in Sevilliana de Electricidad and Fecsa. In the Netherlands, the four largest generators (EPON, EPZ, EZH and UNA) are holding merger talks. In Germany, EVS and Badenwerk are pursuing a merger, and Bayernwerk is seeking to acquire the majority of Isar-Amperewerke. In Denmark, Vattenfall's acquisition of a 10-percent stake in NESA sparked concerns among the Danish Government when it was reported that Vattenfall was also interested in acquiring the 80-percent stake in the company held by the Gentofte, the local municipality.