Danish Government in Danger of Collapse Over Dong Deal

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By Clemens Bomsdorf

The Danish center-left government could be heading toward collapse after the departure of one of three members of the minority coalition over a dispute on plans for the country to reduce its stake in Dong Energy A/S and sell a share to U.S.-based Goldman Sachs Group Inc.

Social Democrat Prime Minister Helle Thorning-Schmidt's coalition partner, the Socialist People's Party (SF) withdrew from the three-member minority government Thursday, saying internal opposition to the Dong deal was "too strong" to ignore.

The parliament's finance committee will vote on the Dong deal later Thursday, and was expected to give it a green light. The deal was initially agreed on in November, but has been strongly criticized in several circles in recent weeks.

The government plans to reduce its ownership of energy utility Dong through a rights issue, which would reduce its stake to 61% and allow Goldman Sachs to buy a 19% share in the company.

Write to Clemens Bomsdorf at clemens.bomsdorf@wsj.com

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  (END) Dow Jones Newswires
  01-30-140638ET
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