Albania plans to block sale of CEZ's local unit

“Several days ago CEZ a.s. publicly announced that it has put up for sale its shareholding of 76% in CEZ Shperndarje, Tirana. The Ministry of Economy, Trade and Energy, which owns 24% of the shares of CEZ Shperndarje, has received this notification only through the media, without being notified in advance or even in the hours that followed, by the company CEZ a.s,” the ministry said.

Considering damages of $1.0 billion (755.7 million euro) caused to Albania by CEZ and the process of revoking CEZ Shperndarje's licence launched by the country's energy regulator ERE, the Albanian economy and energy ministry will take all legal steps needed to block this sale, the ministry said in a press release on Wednesday.

CEZ said on Monday it is inviting bids for its Albanian power distribution unit.

Earlier this year severe drought forced Albania, which relies heavily on water resources for power generation, to import expensive electricity. To help Albanian state-owned power corporation KESH avoid bankruptcy, the government in Tirana decided to raise the price CEZ Shperndarje is paying KESH for electricity supplies.

In November, CEZ said it has requested from Albania a 60 million euro compensation for damages caused to its Albanian unit, which is covered by a World Bank guarantee. CEZ had negotiated the guarantee before entering the Albanian market to protect its investment in a non-consolidated business environment.

($=0.7557 euro)