COPENHAGEN Jan 31 Danish Prime Minister Helle
Thorning-Schmidt, deserted by a key ally over plans to sell part
of a state energy utility to Goldman Sachs, suffered
further blows when its chairman resigned and a poll on Friday
showed her weakened by the plan.
One of Thorning-Schmidt's two coalition allies, the
Socialist People's Party, quit on Thursday over plans to sell 25
percent of the DONG energy utility, highlighting Europe's
growing unease and sometimes outright animosity towards private
"My party sees Goldman Sachs as a bandit in financial
matters that has played a damaging role in the development of
the financial crisis in 2008, and an investment bank that at
almost any cost is prepared to move revenues away from Denmark
to evade Danish tax," said Steen Gade, an MP for the Socialist
While ostensibly backing free energy markets, many European
governments from Spain to Hungary have squeezed utilities by
intervening in power generation, capping energy prices or
re-nationalising some services.
DONG Chairman Fritz Schur, who stewarded a transformation
into a utility with a focus on offshore wind energy, quit late
on Thursday saying he "welcomed the new investors" but it was
time to go with a new minority shareholder coming in.
DONG is 81 percent owned by government with most of the rest
held by municipalities and other energy service providers.
A Gallup poll showed that 54 percent of voters think
Thorning-Schmidt had been weakened by the row, a bad omen as she
started talks on Friday with the Social Liberal Party, her only
remaining ally, to fill six vacant cabinet posts.
GOLDMAN REJECTS CRITICISM
Danish pension fund ATP, which manages 600 billion
crowns ($109 billion) and teamed up with Goldman for the DONG
stake, said the political storm would not change its decision.
"The government has no influence on ATP," Carsten Stendevad,
the fund's chief executive said. "It is not a risk-free
investment. We have looked at the risks and estimated that the
yield we could hope for corresponds to those risks."
Goldman also rejected the criticism.
"This is a long-term commitment which reflects our support
for the management team's current strategy...including the
significant renewable energy investments," Goldman said in a
Scandinavia has so far resisted a European Union drive to
liberalise utilities, keeping energy state owned through
innovative firms building business empires across Europe.
Sweden's Vattenfall has become a key player on the German
market while Norway's Statkraft has grown into Europe's biggest
renewable energy firm with production from Britain to Germany.
Bulgaria's government fell last year after mass protests
against power prices. Hungary forced utilities to implement big
price cuts to relieve indebted households, making power and gas
prices the number one issue in the upcoming election.
Britain's opposition has also proposed price caps.
Georg Zachmann, a researcher at Brussels think tank Bruegel,
said Denmark was something of an outlier at a time of
re-nationalisation for Europe, with local distribution networks
being bought back by municipalities in places such as Germany.
The fight may indeed be about a national champion, similar
to when Microsoft bought Nokia's coveted
handset business and a Chinese investor bought Volvo Cars, said
Paul Krüger Andersen, a professor at Aarhus University.
"You might say this is anti-capitalism," he said.