Crunch time

29 January 2003

If the deal goes through, another one is triggered: coal group RAG will buy a huge chunk of Degussa stock at a 60% premium. Legal wranglings ensure a tight finish. Degussa s current share price implies the odds of completion are 40%.

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German utility E.ON is locked in last minute talks to try and strike an out of court deal that will allow it to buy giant gas firm Ruhrgas. Any settlement before January 31 would allow a related deal to go through, under which E.ON would transfer control of chemical firm Degussa to coal group RAG at E38 a share.

The possibility of an out of court settlement has seen the price of tendered Degussa stock rise by a quarter over the past week to about E30 as the likelihood of the deal has increased.

Negotiations with the nine appellants who have opposed the takeover of Ruhrgas, Germany's biggest gas importer, have continued even as a Dusseldorf court case opened proceedings about the disputed deal on Wednesday.

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