Global corporate governance and takeovers in electric utilities: The case of Enersis, Endesa, and Duke Energy

Abstract

In the 1990s, the success of the ENERSIS conglomerate in Latin
America captured the attention of world electric conglomerates like ENDESA
Spain (ES) and DUKE Energy from the USA. ES tried in 1997 to take over
ENERSIS, which ended with a colossal commitment of investments. The
friendly tender offer lasting for more than 100 days implied significant
Cumulative Abnormal Returns (CAR) that favour minority shareholders,
contrasting with the subsequent hostile ES takeover that implied the realisation
of CAR on ENERSIS conglomerate stocks that vanished before 60 days. This
paper describes the strategies and results of the takeover.