Another IPO that should have been conducted this summer, Complexul Energetic Oltenia, is expected for the second half of 2015, as well.
A number of energy stocks are now trading on the Bucharest Stock Exchange and the latest IPOs are Electrica (EL.RO) – 2014, Nuclearelectrica (SNN.RO) and Romgaz (SNG.RO) – 2013.
The obstacle in the way of Hidroeletrica’s IPO was the relapse into insolvency in February 2014, after a number of traders won the appeals against the 2013 ruling over the end of the insolvency of the electricity generation company.
Hidroelectrica posted gross profit of 910 million lei (EUR203 million) last year compared with the more than RON200 million loss at the time it went insolvent in June 2012, and 2014 prospects are encouraging. The hydropower producer expects a record profit of RON1.1 billion in 2014, after having posted RON943 million profit in January-October. The government owns 80% in the company, while Fondul Proprietatea (FP.RO) owns the rest.
According to the negotiations with the International Monetary Fund and the European Commission, CE Oltenia, too, should have gone public in June 2014. The official in charge of privatizations with the Department for Energy announced in March 2014 that CE Oltenia’s IPO might be pushed back into October because the consultant selected to appraise the coal reserves of the company had requested more time to complete the process.
CE Oltenia, which generates electricity and heat from lignite, slipped into the red this year due to flat demand for power and higher competition from renewable energy producers. Nine months into the year, the company posted RON290 million loss, compared with a RON106 million profit in the same time of 2013. CE Oltenia was created by the merger of the Craiova, Rovinari and Turceni energy complexes with Societatea Nationala a Lignitului Oltenia (National Lignite Company Oltenia) in 2013. The Economy Ministry owns more than 77% in CE Oltenia, while Fondul Proprietatea is another significant shareholder, with 21.5%. (EUR1=RON4.4744)
(English version by Loredana Fratila-Cristescu)