Hafslund - the leading energy company in Norway

- Hafslund is to be the leading energy company in Norway, says Rune Bjerke, CEO of Hafslund ASA when commenting on the go-ahead by the General Meetings of Hafslund ASA and Viken Energinett A/S in conjunction with the merger between the two companies. We shall utilize our new role to reduce costs and to improve the efficiency of our operations. This will benefit both customers and owners, says Rune Bjerke.

- Distribution, production and sale of electrical power will be the core business areas in the new group. Economies of scale and synergy effects will be utilized at all levels. Charting work has shown that there is a high potential for savings - both in the short and long term. Moreover we have a defined objective to develop new services and products based on the large customer base and the comprehensive infrastructure of the new group, says Rune Bjerke. The changes that are now taking place will mean that we are switching roles from minority shareholder in several companies to a majority shareholder. This provides substantial benefits, says Bjerke.

After the merger, Oslo Municipality will be the largest shareholder in Hafslund ASA with an overall stake of 53.7 %. Other major shareholders include Sydkraft with a 15.7 % holding and Vattenfall AB with a 5.8 % holding. - Our aim is to create values for our owners. This is why we will be focusing attention on our day-to-day earnings, says Rune Bjerke. We shall be an attractive investment for industrial, institutional and financial investors. With these changes, we are now sitting in the driver's seat - and we have a good grip on the wheel. We have succeeded in our strategy, says Bjerke.

- The changes now taking place in the power industry are also positive from an economic viewpoint, continues Bjerke. These changes will mean that there are fewer and larger grid companies. In other countries where there has been similar development, the cost reductions involved have contributed towards bringing down end user prices.

The merged company will act as one entity as from today, while completion of the merger in compliance with company law is expected to take place in March 2002. The new company will have about 550,000 grid customers and more than 700,000 electricity customers, mainly in the East Norway region. - The merger will mean that customers will get a better deal, says Bjerke. We will be able to provide more products more efficiently. The same company will now own the grid and will also supply electricity over the grid. This means that invoicing will also be simplified.

The new group will have a workforce of about 2,000. It will encompass Viken's regional and distribution grid in Oslo, Asker and Bærum, Østnett's regional and distribution grid in Akershus and Østfold, and the power sales companies Oslo Energi and Tindra. Hafslund has previously been engaged in power generation both in Norway and in the United States, recording an annual production of approx. 3.0 TWh, in addition to power trading, venture and investment business as well as a rapidly growing alarm business. The new group will also have stakes in numerous power utilities, including 75 % stake in Øko Kraft and 49 % stake in Mjøskraft.

Information is also available at http://www.hafslund.no.


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