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Tender for 66% Stake in Slovenske Elektrarne may be Suspended or Cancelled

An international tender for a 66% stake in Slovakia's state-run power utility Slovenske elektrarne (SE) may be suspended or even cancelled, a source close to the privatisation commission said on Thursday, August 26.

Economy Minister Pavol Rusko opposes such a move, but the fact that all the bidders left in the competition are state-controlled companies has cast doubts on the purpose of the privatisation.

Given positive macroeconomic developments in Slovakia, the government is not forced to sell its stake in SE at all costs. Therefore, there exists, on a political level, a possibility that the competition could be stopped, according to the source speaking on condition of anonymity. PricewaterhouseCoopers (PWC), the advisor to the government on the SE privatisation, is due to recommend a winner on September 10.

The sale is politically contentious. Binding offers for the 66% stake were submitted by three foreign investors: the Czech energy concern CEZ, Italy's Enel, and a German-Russian consortium led by Russia's UES. CEZ is 67% owned by the state, although due for privatisation itself, while in Enel the state holds 51%.

UES International, is 60% controlled by UES Russia, which is 52.55% owned by the state. The remaining 40% in UES is held by 100-percent state-controlled Rosenergoatom.

Enel has reportedly offered the highest price of 40 billion crowns (one billion euros) for the stake in SE. CEZ offered 31 billion crowns, and the UES-led consortium offered just 19 billion crowns.

(NewsBase 30.viii.04)

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