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Premium article: Cristian Parvan, AOAR: “The floatation of energy companies must be performed through share capital increase”


The Social Dialogue Committee of the Ministry of Economy has requested authorities to conduct the listing of energy companies by issuing new shares. Cristian Parvan, secretary general of Businessmen’s Association in Romania (AOAR), which is part of the Committee, has stated: “We requested the ministry to conduct the listings of Romgaz, Nuclearelectrica, Hidroelectrica, Electrica SA, Complexul Oltenia and Complexul Hunedoara by issuing new shares and not by selling stakes of the existing shares.

[cleeng_content id=”889852093″ description=”Buy this translation today! This article has 3336 characters with spaces. ” price=”4.49″ t=”article”]Thus, the companies would have additional capital for investments. Money from floatation has to go to companies for investments, not to the budget”. Gabriel Dumitrascu, head of the State Ownership and Privatization in Industry (OPSPI), has stated: “The sale on the stock exchange of share packages in the energy companies will be made following share capital increases. The listing projects submitted for public debate clearly show it. The funds will go to companies to make investments. In Transgaz’s case, funds obtained following the secondary public offering will go to the state budget. That’s how it was approved, by Government Decision, the sale of a 15% stake in Transgaz. The SPO is in an advanced stage of implementation, so it’s too late to change the destination of money obtained from the sale of shares”. Cristian Parvan specified that the members of the Social Dialogue Committee of the Ministry of Economy had requested to conduct Transgaz SPO by share capital increase: “Transgaz and Transelectrica are strategic companies, which ensure the safety of the national energy system. We categorically rejected the sale of existing shares. Companies need funds for strategic investments. Therefore, we insisted to make the sale of shares on the stock exchange through capital increase and assign the money to companies for investments”. The Social Dialogue Committee also had observations to the project for the sale of minority stakes owned by the state in the privatized subsidiaries of Electrica. AOAR representative has stated that the Ministry of Economy had to verify whether the share capital of Electrica subsidiaries includes the value of land granted for use to these companies after privatization. Mr. Parvan has stressed: “The report of the Court of Auditors shows that authorities failed to assess these lands to include them in the share capital of Electrica’s privatized subsidiaries. At Electrica Banat alone it’s about 140,000 hectares. Thus, the additional shares were due to the state. Authorities must comply and make this assessment and share capital increase before selling the state’s stakes to Enel and E.ON, the majority shareholders of Electrica’s privatized subsidiaries”. According to the draft agreement with the IMF after the mission in January, the Government has committed to carry out Transgaz SPO in April, Nuclearelectrica floatation – in May and Romgaz listing – this autumn. The following companies proposed for primary offering on BSE are Hidroelectrica (for which no deadline is set, because the date when it exits insolvency is uncertain), Oltenia and Hunedoara energy complexes (for late this year and early the next). In an interview recently granted to Bursa newspaper, Minister Delegate for Energy Constantin Nita has stated that the listing schedule would be fulfilled. He stressed that the energy production sector needed restructuring, on a mix of energy resources. Currently the companies are organized on a single production source – water, nuclear, coal, gas. According to Minister Nita, resources cannot compete between each other and producers don’t have equal chances in the market. Therefore, Constantin Nita has started a reorganization process of the production sector on energy mix. Thus, the resulting companies would have equal chances to compete on the free market.[/cleeng_content]

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