Electricity distributor Electrica moves minority stakes to separate firm before privatization

The Romanian state will divide the energy distribution company Electrica prior to privatizing it, and will create a company that will receive all the minority stakes Electrica holds in other companies. The new company will offer business and management consultancy, and will be held by the state as sole shareholder, according to a new Government decision. Electrica is a minority shareholder in all the five energy distribution subsidiaries, now controlled by foreign investors. The company has sold its stakes in these five subsidiaries between 2004 and 2008. In Enel Energie Muntenia, Electrica holds a 23.57 percent package, with a similar size package in ENEL Distribuţie Muntenia. It also controls 24.86 percent in ENEL Distribuţie Dobrogea, and a similar size package in ENEL Distribuţie Dobrogea. It also owns a stake of 37 percent in ENEL Energie, and 27 percent in E.ON Moldova Distribuţie, as well as a smaller 3.78 percent stake in E.ON Energie România. It also controls 49 percent of Electrica Soluziona, and a very small share package, of 0.5 percent, in the Romanian Commodities Exchange. Electriac has asked for penalties between EUR 1.5 and EUR 2 billion from the foreign energy companies CEZ, E.ON and Enel, which bought five of the eight electricity distribution companies in Romania. The penalties would cover breaches of the privatization contracts. However, the foreign investors say the penalties should be much lower, only up to EUR 700 million. editor@romania-insider.com