Montenegro’s power utility EPCG to sell 10% stake to strategic partner

The Government of Montenegro said it would seek a strategic partner for the non-voting shares of state-controlled power utility Elektroprivreda Crne Gore (EPCG), which make up 10% of its equity. The market value of the stake is EUR 42.3 million.

Montenegro owns 88.7% of EPCG’s stocks and has 98% of the voting rights, as the company itself is the owner of 10%. The operator of coal mines, the Pljevlja thermal power plant and hydropower plants acquired the stake of 11.8 million shares in 2019 after a put option was exercised to buy out Italian minority shareholder A2A.

The 10% share carries no voting rights and the company is obligated to sell or write it off by September 26. EPCG bought it from A2A for EUR 52.9 million. The nominal value is EUR 77 million, but only EUR 42.3 million if it is calculated according to the current price of the utility’s common shares at the stock exchange in Podgorica.

The government earlier declined the company’s proposition to buy the stake, so now it authorized the Ministry of Capital Investments to form a negotiating team to represent EPCG in the search for a strategic partner. The company was told to provide an assessment of the investment value, fair value and market value of the stock it owns.

Before EPCG acquired the stake in 2019, a previous package of 13.1 million stocks it bought from A2A was written off.

The government said last year that it would seek foreign partners for the power utility’s wind and solar power projects.