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Romania extends deadline for handover to Enel of Muntenia Sud

Romania's government extended by six months a deadline to hand over control of power distributor Electrica Muntenia Sud SA to Italy's Enel SpA amid a criminal investigation into the sale.

The transfer to Enel must take place by July 17, and the deadline can't be extended again, the state asset-sales agency said in an e-mailed note today. Enel agreed in June of last year to pay €820 million ($1 billion) for 67.5% of Muntenia Sud. The government still hasn't given the offer final approval, said the agency, known as AVAS. It didn't explain the delay, although at least one government official involved in the sale is under criminal investigation. No one from either Enel or AVAS was immediately available to comment.  „Our objective is that the majority stake is transferred to private property to a strategic investor in conditions of total legality and transparency,” AVAS President Teodor Atanasiu said in the note. „Electrica Muntenia Sud is a very important energy unit for Romania.”

Romanian prosecutors are investigating alleged irregularities in state asset sales, including the agreed sale of Muntenia Sud. Dorinel Mucea, a government official involved in the sale of Muntenia Sud, was jailed for two months and released yesterday under orders to stay in Romania while prosecutors investigate. Mucea, who said through his lawyer, Cezar Bivolaru, he is innocent of all charges, is one of eight government and foreign company officials that prosecutors accuse of „undermining Romania's national security” and economic espionage in the sale of state assets. All eight have said they have done nothing wrong. The Romanian newswire Mediafax also reported today that Codrut Seres, the former economy minister who oversaw the sale of Electrica Muntenia Sud, will meet prosecutors about the case Thursday. Seres said December 21 that prosecutors accused him of „treason and espionage” in relation with the case. He denied the accusations. (Bloomberg)