The fine was the largest ever levied by the European Union against a single cartel. Ten companies were ordered to pay €750 million ($978 million) in fines after being found guilty of fixing prices, dividing market share, rigging project bids and exchanging business information with each other from 1988 to 2004. German industrial giant Siemens will have to pay over half the total, hit with a fine of €396.5 million -- plus another €22 million for its Austrian subsidiary VA Technologies AG, which was also part of the cartel before being purchased by Siemens.

"The Commission has put an end to a cartel which has cheated public utility companies and consumers for more than 16 years," the EU's Competition Commissioner said in a statement posted on the Commission's Web site. "The Commission has once more shown that it will not tolerate cartels in Europe and the damage that they do in any area of business."

Siemens, which is also facing a slush fund and bribery scandal at home in Germany, has said it will challenge the "exaggerated" fine. The company received the highest fine because it was seen as a ring leader of the cartel. Fines were allotted to the other companies involved on the basis of market share within Europe.

A number of Japanese companies, including Mitsubishi Electric Corp. -- which was hit with the second largest fine of €118.5 million -- were also penalized. Some of those companies don't even do business in Europe, but were punished for making an agreement whereby they would stay out of the European market provided certain European companies abstained from entering the Japanese market.

All the companies involved in the cartel sold heavy equipment used in regulating energy flows in power grids, which is important for adjusting voltage at power stations. Utilities usually buy such equipment from the lowest bidder after public tenders. But according to EU regulators, the companies involved in the cartel coordinated their bids in order for all participants to be guaranteed some of the available contracts.

Surprisingly, despite Siemens reporting on Thursday that the fine was going to eat into its first-quarter profits to the tune of 16 percent, the companies stock actually went up on news that the Siemens subsidiary VDO -- an auto parts business -- was going to hold an initial public offering.

The up-tick came at exactly the right time for embattled supervisory board chair Heinrich von Pierer. Pierer went before 9,000 shareholders at the annual meeting in Munich on Thursday to answer difficult questions regarding Siemens paying bribes to win overseas contracts. He told the shareholders that he had introduced measures to combat corruption at the very beginning of his term in office. "I am personally especially aggrieved that these efforts were not sufficiently successful," he said.