“We intend to buy several power generation facilities in the neighboring areas,” Borza told a news conference at the Romanian Embassy in Budapest on the occasion of Hidroelectrica’s start of energy sale on the Hungarian market.
It is now in talks with companies in Serbia and Montenegro, Borza said.
Hidroelectrica, which had 630 million (EUR141 million) cash by the end of November, will self-fund the investment and will also take out loans, to which it has ‘unrestricted access’ Borza said.
“We made RON130 million profit in November 2014 so our 11-month profit stands at RON1,073 million,” Hidroelectrica’s court-appointed trustee said. He expects the company to end the year with EUR800 million revenue and EUR250 million net profit.
“The year 2015 will be the year of retooling at Hidroelectrica. We will spend EUR400 million to retool large power plants with a cumulated nameplate capacity of 1,400 MW.”
Hidroelectrica should exit its second insolvency in June or July 2015, and then sell a 15% stake in an initial public offering on the Bucharest Stock Exchange and possibly on the London Stock Exchange in the fourth quarter.
The Economy Ministry owns 80% in Hidroelectrica and Fondul Proprietatea (FP.RO) the remaining 20%.
Remus Borza expects it to raise “at least EUR500 million” from the sale of the 15%, which would value it at EUR3.3 billion or RON14.7 billion.
Such a market value would put Hidroelectrica right behind OMV Petrom (SNP.RO) by capitalization on the Bucharest Stock Exchange, ahead of Romgaz (SNG.RO). Fondul Proprietatea values its 20% stake at RON2.1 billion, which suggests the entire company should be worth RON10.5 billion.
Expansion by new acquisitions of generation facilities is part of its plan to become a more significant actor in the region. It has recently secured the license to sell power directly on the Hungarian market, signing seven contracts for electricity delivery with Hungarian companies since December 1.
“We’ll open a branch in Serbia to sell power in January and I hope to have offices in Austria and Germany by June 2015,” Remus Borza told the news conference.
Participants to the news conference included Romania’s minister delegate for Energy Razvan Nicolescu, the chairman of the energy market watchdog ANRE, Nicolae Havrilet, and the Romanian ambassador to Hungary, Alexandru Victor Micula.
(English version by Loredana Fratila-Cristescu)