Report: Government set to buy RWE stake in Főgáz

Telco

Pencil in Főgáz Zrt to the list of utilities and utility-related companies to be de-privatized by the sitting government since 2010; local news daily Magyar Nemzet is today quoting Főgáz CEO László Köncz as stating that an acquisition of Germany-based RWE’s minority stake in the natural gas supplier could take place within the next three weeks.

Köncz said that an audit of Főgáz finances has been completed which will be followed by an appraisal of value in preparation for sale.

In mid-September, Prime Minister Viktor Orbán stated that his government plans to nationalize six to seven utility companies in the name of lowering household energy prices and revitalizing a stagnant economy. At that time, he specifically named Főgáz as a target for such an acquisition.

The purchase would be the first by a government body since state-owned energy group MVM signed an agreement to buy Hungary-based units of Germany-based E.ON in March.

RWE currently holds a 49.8% stake in Főgáz, with the municipality of Budapest a 50% shareholder. Főgáz supplied some 885 million cubic meters of natural gas to over 800,000 households in the capital city and its environs. Net profit was reported at HUF 7.05 billion ($32.1) in 2013, down 14.3% from HUF 8.23 billion the previous year.

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