The top managers of Iberdrola SA (IBE.MC) and La Caixa are in disagreement over key details of a possible tie-up between Iberdrola and Gas Natural SDG SA (GAS.MC), Spanish state-owned newswire Efe reported Monday, citing financial sources close to the situation.
The talks between Iberdrola, Spain's largest power utility by market value, and La Caixa, controlling shareholder of Gas Natural, are at a "dead end" and may require political pressure to be restarted, Efe said.
Iberdrola's management is balking at La Caixa's plan to appoint a chief executive to the new company resulting from the tie-up, as well as having the company's headquarters in Barcelona, where Gas Natural is based.
Iberdrola, which is based in Bilbao, northern Spain, is almost three times bigger than Gas Natural, in terms of market value.
Speculation of a possible Iberdrola-Gas Natural friendly deal has surfaced in the Spanish media over the last few weeks, as earlier talk of a move into Spain by state-controlled Electricite de France (1024251.FR) fades away.