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CEZ appeals antitrust ban on sale of assets in Bulgaria to Inercom

9 August 2018
Electricity
energynomics

Czech energy group CEZ told SeeNews on Wednesday that it has filed an appeal with Bulgaria’s Supreme Administrative Court against the decision of local competition authority to ban the deal for sale of the group’s assets in Bulgaria to Inercom.

“The appeal was filed August 1,” Alice Horakova, CEZ press officer, said in an e-mailed statement in response to a SeeNews enquiry.

Last month, Sofia-based Inercom also said it has filed a complaint with the Supreme Administrative Court against the competition regulator’s decision.

“We have […] analyzed in detail the reasons for the negative decision of the anti-monopoly authority. We expect a quick and fair decision on the part of the Supreme Administrative Court,” Milena Stoeva, chairman of the board of directors of Inercom Bulgaria, said at the time.

On July 19, the Commission for Protection of Competition said it has banned the sale of the assets of CEZ in Bulgaria to Inercom.

According to the regulator’s analysis, the deal will lead to the establishing of a dominant position, affecting competition. The transaction is of strategic importance for the country and its potential effects would have direct implications for the national security, due to the the wide range of activities of the companies being acquired and their importance to the Bulgarian electricity system, the regulator explained.

CEZ assets in Bulgaria includes power distributor CEZ Distribution, power supplier CEZ Electro Bulgaria, licensed electricity trader CEZ Trade Bulgaria, IT services company CEZ ICT Bulgaria, solar park Free Energy Project Oreshetz, biomass-fired power plant Bara Group and CEZ Bulgaria, which manages and coordinates the operations of the group’s Bulgarian units.

The price of the transaction was 326 million euro ($377.9 million), according to CEZ Group’s annual financial statement, published in March.

The contract between CEZ Group and Inercom was signed on February 23. The deal raised concerns about Inercom’s ability to finance the acquisition, which resulted in the establishment of a parliamentary ad hoc committee with the purpose of looking into the deal.

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