Pressure rises for Gazprom to make deal

  • 2014-06-04
  • From wire report

SELL SIGNAL: Gazprom will soon have to divest itself of some assets in Lithuania.

VILNIUS - Lithuanian Prime Minister Algirdas Butkevicius says that once the state takes over control of gas supply and transmission companies Lietuvos Dujos and Amber Grid, it will be possible to implement strategic decisions faster, reports ELTA.
In a May 22 interview with Ziniu Radijas radio, the prime minister said that the leadership of the German company E.ON Ruhrgas International made a decision to withdraw from the Baltic and Nordic region in early 2013. That is when private negotiations started.

According to Butkevicius, the government took a good opportunity to take over control of these strategic companies, and if Lithuania did not step in, E.ON would have sold shares to someone else.
“When negotiating with gas suppliers we will have more power, and coordination procedures will be facilitated. We will have two additional members on the board of Lietuvos Dujos,” the prime minister said.
Based on current legislation, Lithuania will have to propose to acquire the remaining Lietuvos Dujos and Amber Grid shares from Gazprom and other minor shareholders.
Butkevicius did not predict how much the deal would be worth. According to him, first of all Gazprom has to make its decision.

Nonetheless, the prime minister said that talks and negotiations with the Russian company will be more difficult than with the Germans.
On May 21, Lietuvos Energija, UAB and UAB EPSO-G signed agreements with E.ON Ruhrgas International on the purchase of shares of Lithuania’s energy companies AB Lietuvos Dujos, AB Amber Grid and AB LESTO owned by the German concern. The package of shares owned by E.ON Ruhrgas International in all the companies will be purchased for 147.3 million euros, including the accumulated interest and dividends paid by LESTO. This amount is lower than that assessed by independent appraisers and is calculated according to the weighted average price of shares on the exchange.

Russian gas giant Gazprom though is not rushing to negotiate with Lithuania over its shares in Lithuanian companies Amber Grid, Lesto and Lietuvos Dujos.
“There were various discussions. However, we have not heard anything firm from Gazprom. They say they will discuss it later as this issue was not included in the agenda. Yet I think there will be an offer,” said the prime minister.
According to Virgilijus Poderis, the head of EPSO-G, in October Lithuania will have to complete the implementation of the EU Third Energy Package, and if Gazprom fails to sell its shares in Lithuanian companies by then, it may lose its voting rights.