Hungary's MVM expects the E.ON Energie Romania agreement to close in June or September
MVM Group, the state-owned energy firm in Hungary, expects to complete its deal to purchase a majority stake in E.ON Energie Romania by June or July. MVM's CEO told Portfolio.hu Thursday.
E.ON announced this deal in December. It is subject to the approval of Romanian authorities. MVM, unlike most energy providers in Europe, gets a significant portion of its gas from Russia. In January, the Romanian energy ministry warned that this sale could be halted for security reasons.
Romania's Energy Ministry expressed concern about MVM's relationship with Russia and the possibility that Romanian energy provider MVM could later be sold to an entity located outside of the European Union.
MVM CEO Karoly Mattrai told Portfolio.hu MVM has no intention to divest the companies that it plans on acquiring in Romania. MVM will supply its Romanian clients using local gas sources.
"Transporting Russian Gas to Romania would impose enormous costs on us", he said.
Matrai stated that "since domestic gas supply is always most cost-effective, if the transaction is approved, we will supply our Romanian subsidiary with local gas."
Matrai said that MVM expects to secure the necessary approvals by the end the second quarter, and "that June-July's planned closing schedule can be achieved".
E.ON Energie Romania, Romania's largest gas and electricity provider, serves around 3.4 millions customers.
Matrai said that diversification is important, but that the price of liquefied gas imports to Hungary via pipeline was not competitive with Russian gas.
He stated that the company trades around 12-13 billion cubic metres of gas each year, with Russian shipments making up about 40%. Reporting by Krisztina than and Anita Komuves. Mark Potter edited the article.
(source: Reuters)
