The administrator of Fondul Proprietatea (FP), Franklin Templeton, announced that the Fund sues E.ON Romania for awarding useless intra-group consulting contracts worth 7.7 million euro. However, E.ON România denies allegations and says it „totally respects the current legislation and the corporate governance principles”.
“The Fund requested the agendas completion of the Ordinary General Meeting of Shareholders of E.ON Distributie Romania SA and E.ON Energie Romania SA, convened on May 26 and, respectively, 28 May 2015 for shareholders to approve legal action against board members and directors of E.ON Distributie Romania SA (formerly called E.ON Gas Distribution SA), E.ON Moldova Distributie SA and E.ON Energie Romania SA (“Companies “), to recover damages caused to Companies by approving, the conclusion and implementation of services with E.ON Romania SRL, the company’s majority shareholder,” shows a press release received by energynomics.ro.
“Fondul Proprietatea considers that the services contracted by Companies at the majority shareholder E.ON Romania SRL are unnecessary, and the price paid by the Companies to E.ON Romania SRL for strategic consulting services is unjustified”, FP officials say.
“According to available data of the Fund, in 2014, the total value of these contracts on strategic consulting and management amount to an estimated 34.4 million lei (equivalent to GBP 5.6 million or EUR 7.7 million)”, reads the FP document.
“The Fund believes that the conclusion of these transactions between related parties, called contracts for consulting services in the field of business strategy, concluded with the majority shareholder, are neither necessary nor appropriate, since the Companies have their own administration boards and executives who are appointed for strategic and management decisions and to act in the interest and benefit of all shareholders and not that of the majority shareholder. Fondul Proprietatea believes that the conclusion of contracts on strategic consulting services can be regarded as an abuse of power by the majority shareholder, E.ON Romania SRL”, Fund officials added.
“The Fund believes that this situation represents a conflict of interest and a serious breach of corporate governance principles and requires the management of E.ON Romania SRL in Romania to consider the termination of such contracts, and not to conclude similar agreements with companies in the future”, reads the document.
E.ON rejects accusations
The company “strongly rejects the allegations concerning the so-called violation of corporate governance principles or conflicts of interest, as claimed by the FP managers in a press release today”, said E.ON officials, responding to an energynomics.ro request.
“Our company has always had an institutional collaboration with Fondul Proprietatea and did always respond to all supplementary requests for information coming from this entity. Strategic consultancy service contracts to which the FP representatives refer to were concluded in full compliance with the law, with the approval of the competent corporate bodies and respecting the commercial market terms, certified by the internationally renowned independent experts”, said E.ON representatives.
“E.ON Romania develops group strategies and policies which envisage, among others, maximizing the potential of investments, development of strategic projects and new business projects, improving customer service portfolio, efficient management of all resources of E.ON, as well and continuous improvement of safety standards and environmental protection, to the benefit of all customers of E.ON Romania and shareholders (including the Romanian State and Fondul Proprietatea)”, reads the E.ON response.
