The European Commission (EC) has allowed the company L1 Energy, which belongs to Russia's Alfa Group, to acquire RWE Dea, the oil and gas business of Germany's RWE AG, the EC said in a statement.
The commission did not see any anticompetitive components in the planned deal. The EC said the acquisition of the company would not bring about market concentration since the activities of L1 Energy and RWE Dea do not overlap.
Some time ago, L1 Energy informed the EC of a planned deal to purchase the oil and gas business of RWE AG, RWE Dea.
RWE reached agreement in March on the terms to sell its oil and gas business to L1 Energy, which is owned by Russian businessman Mikhail Fridman, for 5.1 billion euro. RWE Dea is valued at 4.5 billion euro, and the Russian buyer must assume the company’s 600 million euro debt.
In addition, the German government began reviewing the deal in June to determine whether or not it threatened the country’s national interests, including energy security.
It was reported that the deal could be the largest foreign purchase of a Russian business in history. However, if Germany stops the deal, this will be the most significant interference from a western country’s leadership in a deal involving a Russian business since the beginning of the crisis in Ukraine.
Dea produces 31 million tonnes of oil equivalent in 2012, or 84,000 barrels per day and 4.5 million tonnes.
RWE Dea has production operations in Germany, the UK, Norway, Egypt and Denmark. It is working up fields in Algeria and Libya and exploring in Algeria, Ireland, Libya, Mauritania, Poland, Trinidad and Tobago, and Turkmenistan. The company, which has over 1,300 employees, also owns gas storage capacity in Germany.
