Miskov Accused of Hidden Interest in Gas Utility Sale

Based on correspondence between economy minister Juraj Miskov and head of the National Property Fund (FNM), Anna Bubenikova, today’s daily Pravda looks at possible links between the proposed sale of the 49% privatised stake in Slovakia’s gas utility SPP and Miskov’s proposal to recall Bubenikova. Here The Daily provides you with its own translation of the article to English for informative purposes.

Pravda, 11 January 2012 – Economy minister Juraj Miškov (SaS), who concerning the Gorilla corruption affair requested the government to recall the head of the National Property Fund (FNM), Anna Bubeníkova (SDKÚ), has allegedly been in a dispute with her for months over some big business. The stakes concern 49% of the shares and managerial control over the largest company in the country – Slovenský plynárenský priemysel.

Economy minister Juraj Miskov (c) The Daily.sk

The German and French acquirers of the company from 2002 want to sell off their share, but the state also has a say in the matter. The prospective buyer is the Czech company Energetický a průmyslový holding, controlled by billionaire Daniel Křetínsky and the financial group J&T. Miškov pressured Bubeníkova to agree to the provision of the shareholders agreement in SPP to the Czech holding. Bubeníková was against this, however, and so the big deal put in place by the minister has not transpired yet.

Spokeswoman for the Ministry of Economy, Daniela Piršelová, claims the opposite, saying “it is intended to deflect attention and the uncertainty of members of the government before the vote on the motion to recall the head of the FNM for reasons of serious suspicions relating to the Gorilla affair, which is at the centre of media focus.“. The affair burst just a few days after a verbal battle took place between Bubeníkova and Miškov in letters that daily Pravda has at its disposal.

When selling SPP in the past, Dzurinda’s government raised the fact that the stake in the company had been acquired by the German Ruhrgas and French Gaz de France as key players in the sector, which would no longer apply after Křetínsky’s entry to SPP.

The fact that Miškov pushed for Energetický a průmyslový holding to be the owner of SPP is proven in the letters that he sent to the FNM last year, especially at the end of the year. Miškov was to provide his consent to the provision of the shareholders agreement, which is one of the basic steps required before the transfer of ownership in SPP. “The Ministry of Economy agreed with making the agreement available (…) considering the approved due diligence of SPP (analysis of the value of SPP, editor’s note), the ongoing negotiations on ownership restructuring and in an effort to get the most advantageous position possible for the Slovak Republic in the consolidation of ownership relations in SPP”“ said Miškov in justification of his step in one of the letter sent to Bubeníkova. The government was supposed to speak about the provision of the consent as well, according to another letter from Bubeníkova.

It was not possible to get the minister’s comments yesterday because he was on his way back from holiday abroad. However, spokeswoman for the Ministry of Economy, Daniela Piršelová, claims that all the accusations about steps of the Ministry of Economy are false. Head of EPH Daniel Křetínský did not wish to comment on whether he had received the shareholders agreement or not. “I’m sorry, but I cannot comment on that” the head of the energy holding said.

The publication of the letters could be a reply to the fact that the today the government will deal with Miškov’s proposal to recall Bubeníkova from the top post. The minister filed the proposal after the Gorilla and Gorilla 1 reports were leaked, pointing to corruption of politicians from the side of the investment group Penta, in which Bubeníková was also mentioned. In another letter to Bubenikova, Miškov claims that the German and French shareholders, which with 49 percent of shares control SPP, have already decided to pull out of Slovakia.

“According to the statements of GDF Suez and E. ON, their decision to leave this region is final”, the minister wrote to Bubenikova in the middle of November last year. In the letter he also claims that due to the ambiguity of the shareholders agreement there is the possibility that Energetický a průmyslový holding could gain the share from the French and German shareholders also without the consent of Slovakia, and it also admits the option of Slovakia exercising its right of first refusal.

In Miškov’s letter bearing the name of the head of the National Property Fund, he also pushed for the transfer of assets in SPP worth EUR 2.5 billion from SPP to the subsidiary eustream without the knowledge or influence of the government and the National Property Fund, which is the official owner of the 51% stake in the gas company. The department of the economy rejects this accusation, however. “It is provable that the Ministry of Economy issued an instruction twice to abstain from voting at the General Meeting of SPP on this point of the agenda, and it also presented to the government Information about preparation of the transfer of part of the company concerning the transmission of gas from Slovensky plynárensky priemysel to the company eustream. This also is proof that the alleged accusations are complete lies”, argues the Ministry of Economy spokeswoman. Miškov is also supposed to have promoted the so-called zero variant of the supplement to the purchase price in the already executed sale of shares in Slovenske elektrárne. This despite the fact that one of the analyses showed that the Italian Enel should pay an additional EUR 150 million for the 66 percent stake in the power producer.

The 49 percent stake in Slovensky plynárensky priemysel was sold by the Dzurinda government in 2002 for SKK 120.9 billion, which converted by the exchange rate works out at around EUR 4 billion. The return on investment from the perspective of the privatising entity, after the first three years of paying out dividends, worked out at roughly thirteen years, which experts deemed appropriate. Later on, though, the amount of dividends increased, and so the invested money of German Ruhrgas and French Gaz de France had a faster return. Analysts also pointed to how SPP is a lucrative company and could be sold at any time by the foreign shareholders at a profit.

There were supposed to be three companies privatising initially, but Russian giant Gazprom eventually withdrew from the transaction, allegedly due to a lack of capital. Dzurinda’s government and experts, though, evaluated the buyers of SPP as renowned companies that know their business and could modernize the company. Customers evaluated the change of owner rather through the continual growth in gas prices. The company explained this by the fact that while it was still a state-run company the prices were frozen and got to under cost price. The price hikes were encouraged also by the frequent growth in the prices of oil and the purchase prices of gas from Russia.

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  1. […] privatisation agency came from the SaS party, specifically from economy minister Juraj Miskov. He became the target of attacks from Bubenikova, who accused him of applying pressure on her regarding the potential sale of a 49% stake in the gas […]

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