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State acquires full control of SPP
5 Jun 2014 Flash News
THE STATE acquired a 100-percent share in gas utility Slovenský Plynárenský Priemysel (SPP) on June 4, Prime Minister Robert Fico told a press conference, adding that the change in ownership occurred following SPP’s general meeting at 10:00.
Before the transaction took place, Slovakia’s state-owned National Property Fund (FNM) owned 51 percent of the shares in SPP. The remainder, plus management control, was in the hands of private Slovak Gas Holding through its Czech owner Energetický Prúmyslový Holding (EPH).
The state benefits from taking over full ownership of the gas utility by gaining total control over calculations of cost items and the resulting pricing proposals for gas supplies for households and small enterprises, Fico told the TASR newswire. “As a result, there can be no repeat of a situation when a foreign shareholder that had privatised SPP filed senseless proposals with energy regulator ÚRSO on increases in gas rates for households and small companies. As of this moment, we as a state have control over pricing proposals, and I believe, and it’s no secret to repeat it, that we guaranteed price stability between 2006-10, and we're aiming to guarantee it between 2014-16 too,” said Fico.
He also said that the government is gaining full control over negotiations on prices and terms and conditions of supplies from the key supplier. “I won’t go into detail, because that’s still subject to business secrecy provisions, but talks with Gazprom have been concluded. I can only say that the new contract and the new terms and conditions are even more advantageous than those signed a few years ago,” he noted. It was previously reported that the state was seeking to buy the shares from EPH for €60 million.
“Today, this transaction was approved at the company’s general assembly. We will elect the newly-selected SPP representatives in the coming days, and early next week the process of the tender will be concluded,” Economy Minister Tomáš Malatinský said, as quoted by the SITA newswire.
The cabinet approved the take-over of a 49-percent stake in SPP from EPH in September 2013, and it plans to control the pricing of natural gas. The only price for taking over the parent company SPP is taking over the whole debt of €120 million. Fico also believes that thanks to a new contract with Gazprom, as well as storing Russian gas in tanks and the re-structuring of SPP, the management within the company will be consolidated in four years.
Czech company EPH controlled by businessmen Daniel Křetinský and Petr Kellner, as well as Slovak J&T group, bought a 49-percent stake in SPP in early 2013 from previous shareholders, GDF Suez and E.ON Ruhrgas, for €2.6 billion. EPH remains a minority shareholder with managerial control in some of SPP’s subsidiary companies.
The SPP general assembly approved the re-shuffling of the board and supervisory board, with Alexander Sako replacing Daniel Křetínský as the BOD chair, while the board members have also changed.
(Source: TASR, SITA)
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