Danish Government Delays Dong Energy IPO Again

Denmark's Ministry of Finance said Monday it is postponing the long-planned initial public offering of majority state-owned Dong Energy A/S due to the recent turmoil on global financial markets.

The Danish government said Jan. 8 it planned to forge ahead with the listing of 28% of Dong's shares on the OMX Nordic Exchange Copenhagen, after two previous delays.

"Since the Finance Ministry on Jan. 8 began the stock market listing process, international stock markets have been hit with significant losses, and there's been rising uncertainty over future development," the ministry said Monday in a statement.

The ministry said that, against this backdrop, it was unclear if sellers would get a fair price for their respective stakes.

"Therefore, the Ministry of Finance has made the conclusion that it couldn't justify continuing the listing process," it said.

Dong Energy is 73% owned by the Danish state, 11% owned by SEAS-NVE Holding A/S and 7% held by Syd Energi Net A/S, with various other owners holding the remainder of the company, according to its Web site.

The government had planned to retain a 51% stake after the IPO.

Dong management Monday expressed disappointment over the delay.

"We of are of course disappointed that the stock exchange quotation process has been suspended," said Dong Energy Chief Executive Anders Eldrup in a statement.

The company had been due to list during 2007, but parliamentary elections in Denmark, called at short notice, pushed the IPO back to this year. In addition, a European Commission merger investigation delayed the listing process in 2006.

On Jan. 8, a utility analyst who asked not to be named said the market capitalization of Dong is likely to be about 65 billion Danish kroner ($12.64 billion), which would make proceeds from an IPO of 28% of the firm's stock worth just over DKK18 billion.

Dong Energy is an integrated energy company involved in power and heat generation, natural gas and oil exploration and production, as well as trading and sales in the wholesale and retail energy markets.

Ministry spokeswoman Sos Marie Serup said there is no timetable for when the listing will be taken up again.

Copyright (c) 2008 Dow Jones & Company, Inc.


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