Reykjavík City Council Quarrels about REI-GGE Merger Skip to content

Reykjavík City Council Quarrels about REI-GGE Merger

By Iceland Review

Members within the Independence Party of Reykjavík City Council are in a hefty debate about the merger between Reykjavík Energy Invest and Geysir Green Energy, announced Wednesday. Reykjavík City holds a share in REI.

REI was founded in March as the daughter company of Reykjavík Energy (OR) and the board of OR and their shareholders agreed on the merger at a meeting on Wednesday, ruv.is reports.

During the meeting it became evident that the attendees had very different opinions on the role and policy of OR and whether OR, a public company, should participate in such risky private business investments, which is where REI seems to be headed.

Some of the Independence Party members who hold a seat in the City Council said the merger happened too quickly and that their opinions, as representatives voted by Reykjavík residents to protect the city’s interests, had been ignored.

Independence Party council members approached by ruv.is would not comment on the record. One member, Gísli Marteinn Baldursson, only said the case was “sensitive” and that he needed to discuss it further with his colleagues before making any comments.

According to ruv.is, the merger will have certain consequences for the OR board—city councilmen who have a seat there may have to leave the board, including Reykjavík Mayor Vilhjálmur Th. Vilhjálmsson.

Following the debate, Vilhjálmsson requested last night that Bjarni Ármannsson, chairman of REI’s board, allow all OR employees to have the same preemptive rights to purchase shares in REI after the merger, Fréttabladid reports.

Gudmundur Thóroddsson, who is on leave from his position as OR’s CEO and the CEO of REI, was permitted to purchase shares with a par value of ISK 23 million (USD 373,000, EUR 264,000) at the currency rate of 1.3.

Three geologists, two engineers and one economist were permitted to purchase shares with a par value of 7.8 million (USD 127,000, EUR 90,000) at the 1.3 currency rate, but other OR employees were only allowed to purchase shares with a par value of up to ISK 300,000 (USD 4,900, EUR 3,400).

Ármannsson said REI’s board would review the mayor’s request.

Click here to read more about the REI-GGE merger.

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