Italian A2A - new co-owner of "Electric Power Company of Montenegro"

- Italian company A2A will be the new co-owner of "Electric Power Company of Montenegro" (EPCG) - the Privatization Council decided today (August 4, 2009).

According to the announcement, the Council confirmed the decision of the Tender commission and asked it to invite the Italian company to the negotiations and signing of the transaction documentation, after which company A2A will buy and additionally capitalize 18.3% of stocks of EPCG.

The Council definitely rejected the offer of Greek consortium "Golden Energy Capital Management" and "Public Power Corporation" and estimated that A2A's bid was the most favorable because it did not contain any conditions that were unacceptable to Montenegro.

Italians offered the price of 8.4 EUR per stock of EPCG, while Greek consortium offered 11.10 EUR.

Greeks offered higher price, but they also asked for permit to build a steam power plant near Pljevlja, smaller payments of profit to stockholders, audit of General collective contract with employees, change in electric power tariffs, as well as certain tax credits for their consortium.

- These are the conditions that are not anticipated by the tender documentation and their accepting would be harmful to EPCG, employees and Montenegro - the Tender commission estimated.

The estimates are that Montenegro would obtain between 450 and 470m EUR from the sale of the minority share of stocks of EPCG, including earlier sale of stocks of state-owned funds in Electric Power Company to Italian company.