PODGORICA (Montenegro), April 17 (SeeNews) – The government of Montenegro said on Tuesday it will increase its stake in power utility Elektroprivreda Crne Gore (EPCG) [MNG:EPCG] to 70.16% in May, from its current 57.01%, by purchasing 17,252,885 shares from Italian power utility A2A for 68.9 million euro ($85.3 million).
The government had initially planned to purchase next month 7,826,438 shares for 35.7 million euro from A2A, after the latter decided to leave the management of EPCG in July last year, the government said in a statement.
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The government decided to change its acquisition plans and up its stake by 13.15% on Monday, when it adopted a draft contract on the execution of the put option provided for in A2A's management deal between Montenegro and EPCG.
With this decision it aims to speed up the exit of A2A, which was initially planned to take place in seven annual installments, so as not to burden the state budget. The Italian company will now exit EPCG three times faster, saving Montenegro some 20 million euro and creating preconditions for the development of its power producing industry, the government said.
In case any of the planned tranches cannot be realised, the government has the option to return to the primary payment scenario.
Montenegro's government in July last year received an official application from A2A for the sale of the company's shareholding interest in EPCG. The government at the time said it would pay a total of 250 million euro for the shares held by A2A in seven installments, in line with the put option outlined in 2016.
The government and A2A have been signing short-term agreements on the management of EPCG since April 2015, when their five-year deal expired.
($=0.8075 euro)