G-8 energy deal ties in Spanish to further bid
By : Greg Goodale
As part of Spanish energy group Iberdrola's deal for exclusivity to buy the G8 group of distributors, the company will also have to bid for one of four other power generators, it was revealed last week.
Piotr Kapla, an energy analyst at Bank Handlowy, said in exchange for exclusivity in the G8 negotiations, Iberdrola is required to bid for another power generator, which include Elektrownia Stalowa Wola, Elektrownia Ostroleka, Elektrownia Kozienice or Elektrownia Dolna Odra. Kapla said Dolna Odra, which supplies 4.7% of the domestic market and recorded profits of zl. 92.9 million ($22.1 million) in 2000, would be the Spanish concern's most likely choice.
"Kozienice is rumored to be trying to create a consortium with distributors in the southeastern part of Poland," Kapla said. "Ostroleka is only a small power station, while Stalowa Wola would be a good candidate for the Poludniowy Koncern Energetyczny (PKE)."
But Jose Sarrio of Iberdrola's press office was tight-lipped last week, saying only that the company had so far released no official information on the deal. According to the treasury, no tender has been announced yet for any of the four power stations.
The G-8 sale will mark Poland's largest energy sector privatization this year, covering distributors in the northern regions of Koszalin, Slupsk, Gdansk, Elblag, Olsztyn, Torun, Plock and Kalisz. Combined, the eight companies account for about 16% of the nation's total distribution market. In supplying electricity to some 2.6 million customers, last year they yielded turnover of zl. 3.3 billion ($785 million).
But analysts hinted at other reasons for the treasury's decision to negotiate solely with Iberdola.
"Iberdrola was politically convenient for the government as there are no Spanish companies in the Polish power business, so the treasury is seen as encouraging new entrants to the market," said Igor Muszynski, a lawyer for White & Case who specializes in the energy sector.
The treasury last week declined to disclose the exact volume of shares to be sold, the price and the exact conditions of the sale until a privatization agreement is signed, but its original privatization proposal offered 10-25% of each of the companies in the group.
Analysts said that an official signing by the government will not take place until October or November, in line with the established privatization schedule passed by the Sejm this June.
