Poland Determined to Sell Energa Power to Peer PGE Despite Anti-Monopoly Body’s Objections

Poland will stand by its decision regarding the sale of state energy group Energa to listed power group Polska Grupa Energetyczna PGE, Treasury Minister Aleksander Grad reiterated yesterday.

Poland wants to sell 84.2% stake in Energa to PGE for 7.5 billion zlotys.

The deal is subject to the approval of anti-monopoly body UOKiK, which has consistently objected it, claiming the transaction would limit competition on the Polish energy market.

According to the State Treasury, the criteria laid down in the proposed “Poland’s Energy Policy until 2030” program, which envisages a 38 billion euro investment in the country’s energy sector show a necessity for the consolidation of energy consortiums, including the merger of PGE and Energa, which will then be able to compete on European markets and undertake large-scale investments such as nuclear energy plants, the Polish Radio External Service portal - thenews.pl writes.

PGE CEO Tomasz Zadroga said in an interview for Rzeczpospolita daily that PGE's planned takeover of Energa was justified from the economic point of view and would not lead to energy price hikes, , referring to UOKiK’s opposition.

Grad also said that Poland will seriously consider taking advance dividend payment from PGE to end speculations that PGE will be unable to pay dividend once it takes over Energa.

"We will have the supervisory board motion for auditing the results for the first three quarters," he added.

PGE repeatedly said it would continue to pay out dividend on regular basis at the level of 40-50% of net profits, despite the planned acquisition of Energa.

Company CEO also repeated in September that PGE was able to pay an advance dividend in early December based on 9M results regardless of potential investment in Energa.

PGE prospectus assumes dividend payments at 40-50% of net profits longer term, while short-term levels will be adjusted to market situation and capex needs.

Former deputy PM and economy minister Janusz Steinhoff told Polish Radio that the privatization deal is an “obvious attempt by the government to reduce the massive budget deficit.”

A number of economists, former ministers and publicists have appealed to the Polish Prime Minister to forego pressure on the UOKiK with regards to the planned takeover of Energa by PGE, thenews.pl writes.

(by warsaw voice)