Lithuania sells stake in gas company

Lithuania signed an agreement selling a 34 percent stake in the national gas distribution company Lietuvos Dujos to a consortium of Ruhrgas and E.ON Energie, both from Germany, on May 17.

The companies will pay 116 million litas ($30.7 million) for the stake and invest another 70 million litas in a new equity issue, according to a statement from Lithuania's Privatization Fund.

"Our motivation to come to this country was that we saw a good upside potential in this company. We have the intention to be the leading gas company in this country and organize a significant increase in gas sales in this area," Ruhrgas Vice President Eike Ben-ke told journalists.

The transaction should be closed by June 27.

Russian companies were barred from bidding for the strategic stake in Lietuvos Dujos. But they will be invited to participate in a tender for another 34 percent stake for a gas supplier expected to be held later this year.

The Russian group Gazprom has been widely tipped as the likely winner of the tender.

"Our perception of the business in the Baltic states is that a good way to start realizing the benefits of natural gas is in cooperation with a natural gas supplier, and I will not hide that my favorite supplier is Gazprom," said Benke.

The government plans to retain a 24 percent stake in Lietuvos Dujos but may later sell the holding on the local stock exchange, where 8 percent of the company is currently listed.