Norwegian government stops Centrica merger

The Norwegian government has prevented the £19bn merger between Centrica and Norsk Hydro, prompting Centrica to look for major acquisitions instead.

Centrica, the British company that owns British Gas, was keen to acquire access to Norsk Hydro’s huge gas reserves in the North Sea but the Norwegian government, which owns 44% of Hydro, rejected the controversial merger in light of the country’s elections this year.

Centrica is now looking for takeovers or minority stakes in businesses that would assist its domestic gas supply goals. In the last year, the company has abandoned plans to move into telecommunications and consumer businesses in favour of focussing on its core energy business.