Romania's Hidroelectrica starts procedures to take over CEZ, Enel assets

Romania's Hidroelectrica said it has started procedures to take over assets in the country put up for sale by Czech energy group CEZ and by multinational energy group Enel in Romania.

The state-owned Romanian hydro power producer will seek its shareholders’ approval to hire consultants and legal counselors for the prospective deals at an extraordinary meeting scheduled on December 12, according to a notice published on Hidroelectrica's website last week.

At the beginning of the month, Romanian news portal reported that the country's Energy Shareholdings Administration Association (SAPE) has submitted individual non-binding offers for part of the CEZ' assets in Romania offered for sale. SAPE submitted offers for each of the CEZ' assets, in various combinations, reported, quoting sources from the market.

SAPE was created in 2014 and has as its main activity the management of minority interests that the Romanian state owns in energy companies.

According to, besides Hidroelectrica and SAPE, power supplier and distributor Electrica is also interested in CEZ' assets.

Hidroelectrica is 80.06% owned by the Romanian state, while investment fund Fondul Proprietatea owns 19.94%.

In September, CEZ announced that it has launched a process for the sale of its assets in Romania. CEZ is considering selling seven companies in Romania, keeping only those engaged in energy services (ESCO) activities and part of trading.

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CEZ has included the following companies in the market sounding: Energy Distribution Oltenia, Ovidiu Development, Tomis Team, MW Team Invest, CEZ Vanzare, TMK Hydroenergy Power and CEZ Romania.

CEZ is one of the leading integrated energy companies in Romania. Its assets include one of the largest distribution companies in the country with a customer portfolio of 1.4 million and 6,826 GWh of electricity delivered in 2018. In Romania, CEZ also owns Europe's largest on-shore wind park Fantanele-Cogealac with installed capacity of 600 MW and production of 1,105 GWh last year and a modernized hydro electric system Resita consisting of four water reservoirs and four small hydro electric power stations with 22 MW capacity in total, which produced 83 GWh in 2018. CEZ Romania also provides electricity and gas sales to end customers, selling over 3,425 GWh in 2018.

The potential sale of Enel's assets in Romania has been reported by local and international media this year but there has been no official communication from the company in this regard.

In July, Italian newspaper Il Sole 24 Ore reported that even though the sale of Enel's assets in Romania was only a hypothesis at that moment, Australian investment fund Macquarie, Singapore's sovereign investment fund GIC and Kuwait's Wren House Infrastructure were already interested in their potential acquisition.

In 2015, Enel announced that the process of disposing of its assets in Romania was suspended after the group met its debt reduction target at the end of 2014. In July 2014, Enel announced plans to sell five Romanian energy distributors and one services company as part of a broader 4 billion euro programme of divestment aimed at reducing the group's debts.

In Romania, Enel holds a 78% stake in E-Distribution Muntenia and Enel Energie Muntenia, 51% of E-Distribution Banat, E-Distribution Dobrogea and Enel Energie and 100% of Enel Romania. Combined, these companies manage a 128,000 km power grid, which distributes 15 TWh per year and sells approximately 10 TWh per year to about three million customers.