BRUSSELS (Dow Jones)-- French power and carbon dioxide exchange Powernext Thursday approved an equal merger with German energy exchange European Energy Exchange AG (P1EA.XE) to create a single company to provide German and French spot electricity trading services, Powernext said Friday.
The new company will be based in Paris but the deal still needs to be approved by EEX's supervisory board on Dec. 11.
Powernext's board, which approved the deal, also said it agreed in principle to merge its French futures market with EEX's German futures market by 2009. The merged futures subsidiary would be located in Leipzig, Germany.
Powernext will be a significant shareholder in this new entity, and the French futures will be governed through specific arrangements.
Separately, NYSE Euronext (NYX) said Friday it would withdraw its interest in Powernext by selling its 34% equity stake in the company to HGRT, a holding company set up by several power transmission operators to manage their position in Powernext.
HGRT is owned by transmission grid operators RTE, the a unit of Electricite de France (1024251.FR), Belgium's Elia and Dutch Tennet.
Powernext is also selling its CO2 exchange, Powernext Carbon, to NYSE Euronext in order to concentrate on energy services. Powernext expects to launch a French natural gas exchange in 2008.