Romania’s largest power producer exits insolvency

Romania’s largest state-owned electricity producer Hidroelectrica exited insolvency after four years, the Bucharest Court decided yesterday. The court postponed twice the decision on Hidroelectrica’s insolvency exit due to legal actions by the company’s former clients. The producer entered insolvency in June 2012 due to a weakening financial situation caused by the unfavorable contracts with various local and foreign electricity traders. The company sold its electricity way under market prices, and sometimes even at a loss. All these contracts were cancelled when the company entered insolvency. Hidroelectrica thus started selling electricity on the free market, through transparent procedures, and managed to become one of the most profitable companies in Romania. The company was out of insolvency after one year, in June 2013, but the litigations with former clients brought the company back into insolvency in February 2014. During the insolvency period, the firm was managed by the judicial administrator Remus Borza. He said yesterday that the court’s decision was not final, but that it was enforceable. The company’s shareholders now need to elect a Supervisory Board and to prepare the company’s listing on the stock market. The Energy Ministry holds 80% of the company and local investment fund has 20%. editor@romania-insider.com