Shareholders in Romania energy companies decided: conglomerates Electra and Hidroenergetica to be established

The establishment of two major energy conglomerates on the Romania market was given green light by the shareholders in companies which will come under their umbrella. Shareholders in firms which will form national companies Electra and Hidroenergetica approved the establishment of two conglomerates, with the exception of Craiova Energy Complex, where shareholders did not meet because of a court action submitted by Proprietatea Fund.

Proprietatea Fund representatives were the only ones to oppose the establishment of Electra and Hidroenergetica, Tudor Serban, an aide for the Economy minister and head of the Hidroelectrica Administration Council told HotNews.ro.

Following the merger of the energy companies, the Proprietatea Fund would hold 15.09% in Electra and 15.9% in Hidroenergetica, with the Romanian state to remain the majority shareholder.

Tudor Serban told HotNews.ro that for the company to be effectively established a series of court actions with Proprietatea Fund should first be solved.

Franklin Templeton Investment Management Limited, an investment management company which manages the Proprietatea Fund, had said on Friday that it would vote against a proposal by the Romanian Government to restructure state-controlled companies in the energy sector through the establishment of Electra and Hidroenergetica. A press release said that the company was worried about the lack of planning for such a major project and the risk that further problems appear in the future implementation process.

The project to establish the two energy conglomerates has been blocked for several months because of claims raised by creditors, trade unions and natural persons who hold shares in Proprietatea Fund.

A World Bank memorandum shows that the establishment of Electra and Hidroenergetica would have a negative effect on the energy sector capacity to draw funds and the functionality of the energy market.

• Electra will unite: the energy platforms in Turceni, Craiova and Rovinari, Nuclearelectrica, Societatea Nationala a Lignitului Oltenia, Hidroelectrica branches in Ramnicu Valcea, Sibiu, Targu Jiu and Hidroserv Ramnicu Valcea.
• Hidroenergetica will unite Electrocentrale Deva, Electrocentrale Bucharest, Termoelectrica branches in Paroseni and Termoserv Paroseni, Hidroelectrica branches in Bistrita, Buzau, Cluj, Curtea de Arges, Hateg, Portile de Fier, Oradea, Sebes and Slatina, Hidroelectrica branches Hidroserv Bistrita, Hidroserv Slatina, Hidroserv Portile de Fier, Hidroserv Curtea de Arges, Hidroserv Sebes.