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. Last Updated: 07/27/2016

EC OKs Sale of Key Gas Link

BRUSSELS, Belgium -- A German-French-Russian group won approval from the European Commission on Friday to purchase 49 percent and management control of the key Russia-Western Europe gas link, SPP, for $2.7 billion from Slovakia.

The privatization of Slovensky Plynarensky Priemysel is a crucial pillar to the government's economic platform, with the proceeds already earmarked to be split between retiring state debt and financing wide-scale restructuring of Slovakia's shaky pension system.

"The commission concluded to the absence of competition problems because the current users have secured access to the SPP pipeline through long-term transit contracts," the EU executive said in a statement.

Two of the three members of the consortium that purchased SPP, Gaz de France and Germany's Ruhrgas, will at first hold all of the shares, giving partner Gazprom time to pay for its share.

Although the group will acquire management rights in SPP, the government will continue to hold the majority of the stock and will have a veto over key decisions, officials have said.

The consortium creates a pan-European gas chain, the first of its kind in the region. Gazprom supplies around 70 percent of the Russian gas used in Western Europe through SPP, and the two other members are major end-users.

The deal is also one of the largest selloffs of state assets in Eastern Europe, despite attempts in Slovakia to sink it by some who said the price tag was too low.