IBERDROLA yesterday launched a spirited pre-emptive strike against potential predators as the Spanish power giant announced a huge jump in profits, boosted by its acquisition of ScottishPower.
Spain's second-largest utility, which completed the friendly takeover of the Glasgow-based business for £12 billion last year, revealed a 42 per cent rise in net profit to 2.35bn (£1.78bn).
The Bilbao-headquartered firm had earnings bolstered by t
he strong performance at ScottishPower, which contributed some 1.35bn to underlying earnings before interest, tax, depreciation and amortisation (Ebitda), on revenues of 5.18bn, despite only being part of the group for 253 days of the period under review.
Iberdrola said the integration of the company into its business had been completed in five months.
However, while this process was being completed it emerged that the expanded firm was being stalked by both Spanish construction group ACS, which owns 12 per cent of Iberdrola, and French utility EDF. Both confirmed that they had held exploratory talks over a possible bid.
Yesterday Iberdrola's outspoken chairman, Ignacio Sánchez Gálan, used the company's results presentation to launch a passionate attack on EDF and its majority owner, the French government. "It has been made clear in the last few days that EDF is not welcome from a political point of view nor from a social point of view, nor from a union ... or shareholder point of view," Gálan said at a press conference.
He then accused the French government of being protectionist, saying it operated one of the last unliberalised power markets in Europe.
"What they say is: France is for the French and so is everywhere else," he added.
The hostility towards the bid is unlikely to be encouraging to bidders, with the French government indicating it had told EDF, in which it has an 80 per cent stake, only to proceed with the support of the Spanish government.
EDF chief executive Pierre Gadonneix yesterday said that the company is in exploratory talks in Spain, but no decisions have yet been taken on whether to proceed with a bid.
Reports claim that, if ACS and EDF bought Iberdrola, the French group would take control of ScottishPower as part of a carve-up.
However, in a robust defence of his firm and his strategy, Gálan maintained the company was in a strong position to maintain independence.
The Iberdrola chairman refused to be drawn on his opinion of any specific rumours concerning who might attempt to buy his company and made great play of his theory that the company's performance would be his best defence.
"This company is in a position to keep growing and respond to the support we have received with the best possible project, a unique one, represented by our 2008-2010 strategic plan," Gálan told analysts at a presentation on the results.
Iberdrola had received support from various shareholders, politicians and trades unions who are all against a break-up of the company.
"I can say clearly that we are already a giant in global terms ... and we have a healthy balance sheet which will allow us to finance investments," he added.
"We will continue to add value in the coming years, and in 2008 expect strong or very strong growth in all areas."
Gálan underlined the fact that Iberdrola is privately owned in contrast to EDF which is over 80 per cent owned by the French state, although he did not quote the French firm by name in his comments.
The full article contains 591 words and appears in The Scotsman newspaper.
