GDF Suez snaps up Econergy as offset market consolidation continues

The consolidation of the global carbon offset market stepped up a notch yesterday, after Goldman Sachs' purchase of a stake in US offset specialist Blue Source was followed by news that French energy giant GDF SUEZ Energy International has all but completed its long-running takeover of renewable power project operator Econergy International.

Suez tabled a £39m bid for UK-listed Econergy back in June, gazumping a £27m bid from carbon trading specialist Trading Emissions Plc.

The company announced yesterday that it has now acquired 97.7 per cent of Econergy's shares and has attained regulatory approval to complete the deal. At the same time, Econergy applied to the London Stock Exchange to delist its shares.

Econergy specialises in renewable energy projects in the Americas, which as a by product generate carbon credits that it can sell on global carbon markets.

The company claims to have 266MW of small hydro, wind and coalbed methane projects in operation or construction and a portfolio of approximately 200MW of projects in various stages of development across Brazil, Bolivia, Costa Rica and the US.

Dirk Beeuwsaert, chief executive of GDF Suez Energy International, said the deal would bolster the company's expertise in renewable energy and carbon trading in Latin American markets where it already has a substantial presence.

"We think Econergy International to be a perfect fit and complementary to our international energy portfolio," he said. "The company continues to develop a series of interesting renewable assets, such as wind and small hydro, in markets where GDF Suez already has a presence or aspires to take positions."

The deal forms part of a trend that has seen companies involved in carbon offset projects turn to established utilities and banks to fund increasingly large-scale emission reduction projects.

JPMorgan acquired ClimateCare earlier this year, while Goldman Sachs also announced yesterday that it had taken a stake in Blue Source. Further consolidation of the market is also expected as growing numbers of firms seek to buy their way into a booming global carbon market estimated to have doubled in size last year to $64bn (£40.6bn).