Latvia announces tender to package power firm

RIGA (BNS) - The board of the Latvian Privatization Agency April 20 decided to announce an international tender to pick a financial advisor for a fourth attempt to restructure and privatize the state-owned electricity utility company Latvenergo, LPA spokesman Edgars Zellis said.

The LPA also decided to approve the timetable for the tender.

Zellis said LPA plans to announce the tender in the local state newspaper Latvijas Vestnesis and in The Financial Times.

Latvenergo restructuring and privatization working group comprising officials from the Economics Ministry, LPA, Employers Association and Latvenergo state trustees completed work April 17 on a work plan for the financial advisor.

The chief tasks of the advisor will be to prepare Latvenergo's co-generation enterprises for privatization of thermo-power exchanges and to provide assistance to the LPA in selling shares of the co-generation enterprises, to propose the optimal structure for the power distribution sector, to assess the possible investment of private capital into the distribution sector as well as to develop scenarios for the cooperation of Latvenergo with Baltic states power transmission companies in the context of formation of an integrated Baltic power market.

The LPA said the advisor should have international experience and a good reputation, experience in restructuring and privatization of energy companies, both in Western countries and in Central and Eastern Europe. The advisor also should have good knowledge of the European Union power sector regulation mechanisms and should be experienced in assessing companies and analyzing the financial situation.

"The LPA hopes attracting an advisor with broad international experience in similar projects will help Latvia to ensure formation of an open electricity market, including efficiently managed production, transmission and distribution and an efficient sales system capable of operating in a liberalized Baltic and European energy market," said Zellis. "The advisor's assistance will be put to good use in transforming Latvenergo in a modern and competitive company meeting the European Union requirements.

LPA Director General Janis Naglis told reporters previously that the companies willing to join Latvenergo's restructuring and privatization advisorship may apply by May 19 while June 16 could be the date by which these companies have to submit their tender proposals.