After winning the Elektroprivreda Crne Gore (Bloomberg: EPCG ME) tender, Golden Energy and Public Power Corporation have announced their intention to buy out minority shareholders. The Greece-based consortium offered to pay € 11.1 per share for an 18.3% stake in EPCG last Friday. Italy-based A2A will be able to earn € 80m over three months if it decides to sell its stake to the Greek companies. A2A purchased a minority stake in EPCG through the stock exchange at € 7.2 per share. The Greek consortium also clarified that it does not questions participation at the capital increase by acquiring concession to build the Maoce thermal power plant and does not dispute the government’s shoot-out option after five years. The Greek consortium also spoke out against speculation that the tender offer is conditional. In a statement to the press, the consortium said it is prepared to invest € 2bn in EPCG and renewable sources of energy.
Our view:
The Greek consortium consists of Greek electricity company Public Power Corporation and Golden Energy, a company owned by Greek billionaire Mr Viktor Restis. Mr Restis recently purchased a small hotel management company, Aman Resorts, which manages the Sveti Stefan hotel resort in Montenegro. It therefore seems possible that the Greek consortium has more incentive than other players to become the Montenegrin government’s strategic partner in EPCG. The government has asked the Greek companies to clarify their stance towards certain conditions of the tender, after speculation that the consortium would not accept certain non-negotiable conditions in the tender contract. However, this latest statement suggests the consortium now stands a good chance of winning the tender. We expect the news to have a positive impact on EPCG’s price today.