A Paris court on Tuesday told Gaz de France to provide its works council with more details on the state-owned gas supplier's planned merger with Suez, a source close to the situation told Reuters.
Gaz de France's shares accelerated losses to 9 percent shortly after the ruling, even though analysts said the court's decision was unlikely to prevent the two groups from completing their long-delayed merger in the first half of 2008 as expected.
"This is not necessarily good but it comes on top of other upsets such as gas tariffs or the weak stock market," said an analyst who asked not to be named. "That said, there are no real doubts the merger will be completed, and probably in the timetable indicated by the companies."
Gaz de France needs the works council's recommendation before it can call a shareholders meeting to vote on the merger proposal. But a negative opinion from the works council would not stop the merger going ahead.
Analysts at French broker Aurel Leven said a merger before end-June was still "doable".
Gaz de France shares were down 8.7 percent at 33.69 euros, while Suez shares were off 6.2 percent at 38.57 euros and the European utilities sector fell 4.1 percent.
Gaz de France, whose management took some labour unions to court last month for blocking the consultation process with staff representatives, had no immediate comment.