The owners of Reykjavík Energy (OR) confirmed Reykjavík City Council’s rejection of the planned merger between Reykjavík Energy Invest (REI), in which OR holds a share, and Geysir Green Energy (GGE) at a meeting on Friday.
The next step after rejecting the REI-GGE merger, according to Reykjavík City Council’s plan, is for OR to reach a compromise with the owners of GGE so that REI and GGE can cooperate on energy investments without merging, Fréttabladid reports.
Then REI would become an investment company within OR and would purchase shares in GGE. GGE could thus continue to expand into foreign energy markets through projects which have already begun.
Chairman of OR’s board Bryndís Hlödversdóttir has been given the role of reaching a compromise with GGE. Chairman of GGE’s board Hannes Smárason has earlier announced that he will not accept the annulment of the merger agreement with REI and he does not exclude a lawsuit.
On October 11, the controversial REI-GGE merger caused the Independence Party-Progressive Party majority coalition within Reykjavík City Council to split mid-term. Mayor Vilhjálmur Th. Vilhjálmsson left his post and a new coalition majority formed with Dagur B. Eggertsson as mayor.
Reykjavík City Council rejected the merger on November 1, which had previously been accepted at an OR board meeting October 3. The City Council argued OR’s board members had not been provided with sufficient information to know what they were agreeing to, and thus proposed the merger be annulled.
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