The boards of Statoil ASA and Hydro ASA have recommended merging Statoil ASA with the oil and gas activities in Hydro.

“This is the start of a new era. We are creating a global energy company and strengthening Norway’s oil and gas industry,” says Prime Minister Jens Stoltenberg.

“The merger creates a more forceful and competitive company,” says Stoltenberg.

“The new company will create huge values for Norway. And the merger is an excellent foundation for meeting the challenges facing the oil and gas industry. The government sees the recommended merger as industrially and strategically well founded,” says the Prime Minister.

The government’s intention is to be a long term owner in the merged company and it intends, over time, to increase its ownership share to 67 per cent. To this end, the government will request the necessary authorization from the Storting.

Hydro ASA will remain a separate listed company based on its aluminium and power generating business. This creates the basis for an even further development of the aluminium business.

The state will uphold its ownership share of 43.8 per cent in Hydro ASA.

The government will continue its ownership policy. This entails that the government will follow the same business principles for the merged company which have been applied for Statoil and Hydro.

The government will await further information from the companies about the merger and the price/valuation.