SOCAR obtains 66% share of Greek gas company DESFA
By Aynur Jafarova
Azerbaijan's state energy company SOCAR has acquired a 66-percent block of share of the Greek natural gas transmission network operator, DESFA.
An agreement was signed on December 21 among SOCAR, the Hellenic Republic Assets Development Fund (HRADF), and the Petroleum Company.
DESFA is a division of the Greek state gas company DEPA, whose privatization failed in June due to the lack of formal bids including that from Russian giant Gazprom, which had been considered the most likely buyer of DEPA.
Following an international tender announced earlier by HRADF, the parties signed an agreement on the sale of share package and shareholders agreement.
The signed documents will come into force after their approval by European Commission Directorate General for Energy and Antitrust Policy which is expected in the second quarter of 2014.
A controlling share package of DESFA, acquired by SOCAR is of great importance from the viewpoint of enhancing Azerbaijan's role in ensuring Europe's energy security, as well as attracting foreign investments to Greece. The purchase of equity in DESFA will allow SOCAR to participate in various investment projects in the Balkan countries.
The governing board of the Greek state privatization fund TAIPED approved the Azerbaijani company's revised offer for a 66 percent stake of DESFA in early August.
SOCAR offered 400 million euros for the purchase of 66 percent of shares, including 31 percent of the shares owned by the Greek state privatization fund and 35 percent of Hellenic Petroleum's stock.
HRADF will have the control over the sold part of the shares till the end of the transfer, that is, the seller will retain control over DESFA till the end of 2014.
SOCAR is involved in exploring oil and gas fields, producing, processing, and transporting oil, gas, and gas condensate, marketing petroleum and petrochemical products in the domestic and international markets, and supplying natural gas to industry and the public in Azerbaijan. Three production divisions, two oil refineries and one gas refinery, an oil tanker fleet, a deep water platform fabrication yard, two trusts, one institution, and 22 subdivisions are operating as corporate entities under SOCAR.
The company owns gas stations in Azerbaijan, Switzerland, Georgia and Ukraine. It has representative offices in Georgia, Turkey, Romania, Austria, Switzerland, Kazakhstan, Britain, Iran, Germany and Ukraine, and trading companies in Switzerland, Singapore, Vietnam, Nigeria and other countries.