©THE HEREN REPORTS -Two break away in race for Electrica Muntenia Sud stake

Two bidders have offered more than EUR 750 million for a stake in Romanian power distribution company, Electrica Muntenia Sud, according to Ioan Codrut Seres, the Romanian minister of economy and commerce on Wednesday (10th May).

According to reports from Romanian Mediafax, Seres stated that a privatisation committee would announce the names of the companies making the best two offers in two or three weeks.

CEZ from the Czech Republic, Italian power group Enel, Gaz de France International, Spain’s Iberdrola and RWE from Germany submitted improved bids for an initial 50% stake from the government, which will immediately rise to 67.5% with a capital injection. CEZ, Gaz de France and Enel already have interests in the Romanian market.

A release from the ministry stated that the five bids would be analysed by the government and its advisors PricewaterhouseCoopers and Norton Rose. The top two bids will be chosen, the second in case negotiations with the top bidder fall through.

Electrica Muntenia Sud serves the region around Bucharest, selling over 4.5 TWh annually.

Four of Romania’s eight power distribution companies are already privatised, and a spokeswoman for the Office of State Ownership and Privatisation in Romania said that consultants had only just been hired for the privatization of Electrica Muntenia Nord, Transilvania Nord and Transilvania Sud. Romania’s market monitoring office told The Heren Report that around 50% of Romania’s total electricity market by volume is now privatised, raising to 61% with the sale of Electrica Muntenia Sud.

(THE HEREN REPORTS - EDEM 10089 / 10 May 2006)

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