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Romania power firm could have $1 bln profit – agency

  A future integrated energy holding approved by Romania’s government on Wednesday could reach an operating profit of €800 million ($1.1 billion) by 2012, privatization agency AVAS said on Thursday.

 

 

Its turnover is estimated to reach €2.5 billion to 3 billion by 2012, said AVAS, which handled the draft law to set up the company. The holding, which will have an estimated worth of up to €24 billion, will incorporate Romania’s three remaining electricity distributors along with hydro-power producer Hidroelectrica and two major lignite-fired energy firms. “This turnover will put the energy company in second place in Romania after Petrom” a statement from AVAS said.

The statement said the company could list around 25% of its shares on the Bucharest bourse in two to three years from its creation and that the listing could ensure additional development funds of €4 to 5 billion. The main opposition party has threatened to file a vote of no confidence against the minority cabinet in parliament if the company is created. Some energy workers’ unions have also threatened to go on strike.

Analysts say Romania has a sound mix of hydro, nuclear and coal-fuelled energy but producers across the spectrum badly need costly technological upgrades to meet stringent environmental standards in the European Union and boost production. (Reuters)