Eon ready to fight over Ruhrgas deal

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Eon, the German utility set to take over gas supplier Ruhrgas in a €10.4bn ($10.25bn) deal, on Wednesday fired a warning shot at opponents of the takeover saying it would "pursue all ava ilable legal channels" to make it happen. Centrica, Britain's biggest household energy supplier, opposing the German government's clearance of the takeover asked the European Commission to stop the deal amid concerns it might damage the energy sector. The move came after a Düsseldorf court upheld a temporary injunction against the acquisition on August 2 supported by domestic rivals, on the grounds that ministers had not consulte d properly before backing the takeover. Eon made its comments as it revealed a 42 per cent increase in first-half internal operating profits from €1.66bn to €2.35bn. The improved result, which one analyst described as "a little ahead of market expectations" was driven largely by a strong performance in Eon Energie, which supplied 47 per cent more power than in the same period of 2001. A recovery in electricity prices, a cost-cutting programme in its energy division and consolidation of new businesses were also behind the improved operating result. Group sales, howe ver, slipped 15 per cent, from €21.9bn to €18.7bn. The company attributed the fall to the sale of non-core chemicals assets and metals distributor Klöckner. But Eon, whose drive for acquisitions saw it recently complete a £9.6bn ($14.8bn) takeover of PowerGen, the British energy company, Eon said that although it expected full-year operating profits to beat last year's result, growth in the second half would not match that of the first. "We will not . . . be able to m aintain the first half's high rate of increase, which was due in part to the effects of first-time consolidations," the company said.