DEPA Infrastructure: Playing a tight defense with its sale to Italgas

The award of the sale of DEPA Infrastructure to Italgas for a price of 733 million euros in September last year and the signing of the purchase agreement in December of the same year between HRADF and Hellenic Petroleum-HELPE and the Italians in the presence of Finance Ministers Christos Staikouras and Development and Development and Investment Minister Adonis Georgiadis, was described as a success story by the government in the field of privatizations.

The second largest European gas distribution manager offered a high price for acquiring 100% of DEPA Infrastructure, which has three profitable subsidiary Gas Distribution Companies-EDAs (EDA Attica, EDA THESSA and DEDA) with a large investment network development program in almost the entire Greek network.

The HRADF and the buyers were waiting for the approval of the transfer by the Competition Commission – a decision that was issued – but also the certification of the three EDAs by the Regulatory Authority for Energy-RAE. The timetable showed that the Privatization Fund would receive the big price by the end of the month. Then, as announced, the Kopelouzos group would enter the shareholding scheme of Italgas with a percentage of 10% to 20% and the deal would be sealed.

The terms in the contracts with HRADF and HELPE were locked and the time was approaching for the closing of the transaction…

RAE

What remained, as mentioned above, was the certification of the three EDA by RAE, a procedure followed in cases of transfer of shares of Administrators and the competent authority for approvals and control is RAE.

However, the Regulator suddenly set two conditions in the certification decision. The first was the non-increase of the share capital within the next three years, in order to avoid the risk for the resale of DEPA Infrastructure, and the second was to maintain for the same period a fixed organization chart for the three EDA. The reason invoked by circles of the Authority is to not lay off employees.

The draft decision, in fact, the information says, stipulated that if the investor proceeded with these two aforementioned actions, then a thorough audit would be started again, effectively rendering the certification invalid.

HRADF, the Italians and the government…

The HRADF and the Italians want information to have been disturbed by this move of RAE.

In particular, sources of the Fund want these actions of the Authority to be outside the competence of the Regulator! In addition, the law on the establishment of DEPA Infrastructure provides for the process of merging the three EDAs, something that the Italians can do.

But, according to some government sources, the resale of DEPA Infrastructure within three years – and in the midst of an energy crisis with gas as the main trigger – would not bring the expected income to the Italians in relation to the price they would have paid.

Sources also show the ministers of Finance and Environment & Energy, were surprised by RAE’s decision…!

Italgas executives visited RAE yesterday to discuss the terms set by the Authority for certification. The message sent by the Regulator was that “the text of the certification decision does not change”

Everything shows that the transfer will be delayed… And the HRADF had begun to ‘massage’  Italgas in order for it to “accept the terms and not to back down by ‘blowing up’ the sale”. Although other sources wanted the first reactions of the HRADF being “annoyance”… at the attitude of the Regulator.

In addition, the Italians reportedly have not yet revealed their full intentions but are certainly annoyed by the attitude of RAE and the government, according to sources.

Other officials want the government to be playing a time defense… for the sale of DEPA Infrastructure, but no one can say for sure what the reason is for the delay in completing the transaction…