Romania: Enel postpones selling of distribution companies

, SEE Energy News

The Italian company Enel has suspended the planned sale of assets in Romania, after having reduced the company’s debt in 2014.

In the period between 2005 and 2006, Enel became the owner of three companies for electricity distribution and supply – Electrica Muntenia Sud (including Bucharest), Electrica Banat and Electrica Dobrogea.

The company occupies third place in the market for renewable energy, given that it owns several wind farms in its Romanian portfolio.

Enel, one of the most indebted European companies, was planning to sell the distribution companies in Romania, as part of a wider program to achieve savings of 4 billion euros. However, the company sold a 22 percent stake in Spain’s Endesa, thereby providing around 3.1 billion euros of aid for debt reduction.

The Management Board of Enel updated the plan published in July 2014, which included the sale of Enel Group’s stake in Eastern Europe. The new financial plan will be presented on March 19, and the Board agreed to postpone the sale of assets in Romania and continue with sales of electricity production capacities in Slovakia.

In March, the Director of Enel Francesco Starace, will present Enel Group’s business plan. Company’s reported debt amounted to 38 billion euros, at the end of December 2014.

Electric Power Industries across the region are getting rid of their property, and tend to strengthen the balance, affected with low wholesale prices, weak demand and competition from renewable energy sources.

The Romanian Government considers energy distribution as a strategic activity, and said earlier that it is interested in Enel’s capacities in Romania. Analysts estimate that the value of these units is between one and one and a half billion euros.

The European No. 2 company, in terms of installed capacity, is still waiting for the proclamation of the winner of the tender for the sale of the majority stake in the Slovak company Slovenské elektrárne.