Romgaz analyzes potential takeover of Bucharest’s heat supplier

State-owned Romgaz, one of the two big gas producers in Romania, analyzes the takeover of Electrocentrale Bucuresti, a state-controlled electricity and heat producer that generates the heat and hot water for households in Bucharest.

Electrocentrale Bucuresti is under judicial reorganization due to cash flow problems. The reorganization plan drafted by the company’s judicial administrator provides the transfer of the company’s assets to a third party at a price determined by an independent evaluator.

The Bucharest City Hall and the Government have preemption rights on the company’s assets. If the Bucharest City Hall doesn’t make an offer for the assets, Romgaz could submit one on behalf of the Economy Ministry, according to Economica.net. The gas producer plans to hire a consultant to advise it on this potential takeover.

Electrocentrale Bucuresti is one of the biggest electricity producers in Romania. The company operates four power plants in Bucharest that produce both electricity and heat.

The distribution of heat and hot water to households in Bucharest is done by a company under the municipality’s control. The municipality’s former heat distribution company RADET went bankrupt due to unpaid invoices to Electrocentrale Bucuresti, which, in turn, accumulated a large unpaid debt to Romgaz, which supplies the gas used by the company’s power plants.

Romgaz also owns the Iernut power plant.

(Photo source: Facebook/Romgaz)