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BUCHAREST (Romania), February 14 (SeeNews) - Italian utility Enel has been ordered to pay 401.2 million euro ($425 million) for a minority stake in Romanian power distributor Electrica Muntenia Sud, following a decision by the International Chamber of Commerce of Paris in a case filed by Romania, Enel's legal advisor in the case said.
Romania filed the case in 2014 seeking to exercise a put option included in the contract on Electrica Muntenia Sud's privatisation, and asking Enel to pay 521.6 million euro for a 13.57% stake in the power distributor. According to local media, Enel was willing to pay only 300 million euro for the stake. Romania wrapped up the sale of 64.4% of Electrica Muntenia Sud to Enel for 820 million euro in 2008.
"[...] this arbitration, which was much more complex than it appears, has raised many issues concerning civil law, privatisation and, in particular, issues related to the energy legal framework, covering various specific elements of the spot regulated market," Zamfirescu Racoti & Partners arbitration specialist Cosmin Vasile said in a press release.
In a separate press release Enel said it is analysing the details of the court's decision, adding that the outcome of the proceedings is in line with its financial provisions set for the case.
According to the privatisation contract, state-controlled power distributor and supplier Electrica [BSE:EL] has the right to sell part of or the entire stake it still owns in former Electrica Muntenia Sud, of 23.57%, and Enel has the obligation to buy it. A stake of 10% in Electrica was subsequently distributed among the company's employees, leaving Enel with the obligation to buy only the remaining 13.57%.
In July 2016, Enel won an arbitration case against Romania which claimed that it did not respect certain provisions of the privatisation contract and asked for 1 billion euro in damages. The court ruled that Romania has to pay 1.5 million euro for the court fees.
($ = 0.9418 euro)