Eesti Gaas submits application to Latvian Competition Council on acquisition of Gaso

RIGA - Estonian natural gas Eesti Gass has submitted an application to the Latvian Competition Council on acquisition of Latvian natural gas distribution system operator Gaso, LETA learned from Eesti Gaas,

Also, Eesti Gaas has submitted a request to the Cabinet of Ministers, asking for permission to purchase Gaso from Latvijas Gaze. Both documents were submitted on April 28.

Eesti Gaas board chairman Markus Kaasik said that the company is making all the necessary steps in order to receive the permissions and complete the transaction.

"We are sure that the transaction will promote efficient development of the natural gas market and consumers and other market players will benefit from it," said Kaasik.

As reported, Latvijas Gaze has signed a definitive agreement to sell Gaso to Estonian gas company Eesti Gaas, according to Latvijas Gaze's statement to Nasdaq Riga.

For the transaction to be completed, a government approval is needed for the handover of national security assets and clearance from the competition authority.

Latvijas Gaze will receive a base equity consideration amounting to EUR 120 million and interest payable for the time until completion. The transaction is expected to close by the end of 2023, subject to customary closing conditions.

The sale is part of Latvijas Gaze's ongoing strategic plan to streamline its operations and focus on its core business - gas wholesale and retail trading.

In accordance with the current regulation, Gaso cannot be run by Russian or Belarussian shareholders, and since Latijas Gaze has shareholders from Russia, Gaso must be sold.

Gaso is a subsidiary of Latvijas Gaze natural gas company and the only natural gas distribution system operator in Latvia. The company ensures the safety of gas networks, provides technical services and measures gas consumption. Gaso launched operations in December 2017.

Gaso's share capital consists of 39.9 million shares. Latvijas Gaze is currently the sole owner of Gaso.

In 2021, Gaso turned over EUR 57.91 million and generated EUR 11.55 million in profit.

The largest shareholders of Latvijas Gaze include Russia's Gazprom (34 percent), Marguerite Gas II S.a.r.l. (28.97 percent) and Germany's Uniper Ruhrgas International GmbH (18.26 percent) and Itera Latvija (16 percent).

Eesti Gaas operates in Finland, Latvia, Lithuania and Poland under the Elenger brand name. Eesti Gaas offers customers natural gas in the form of pipeline gas, compressed natural gas (CNG) and liquefied natural gas (LNG) and operates Estonia’s largest gas network. The company is actively engaged in international energy trade and develops a renewable energy portfolio in the form of solar energy and biomethane production and sales.

Infortar, the owner of Eesti Gaas, operates in five countries, the company's main fields of activity are energy, shipping and real estate. The balance sheet volume of Infortar reaches EUR 1.1 billion. The Infortar Group has a total of 47 subsidiaries. Infortar owns a 41 percent stake in Tallink Grupp, a 100 percent stake in Eesti Gaas and a versatile and modern real estate portfolio.