SORAINEN Estonia is advising Fortum, a Finnish energy company, on the sale of its 51.4% shareholding in associated company Võrguteenus Valdus for EUR 27.5 million to the 100% state-owned Estonian electricity transmission system operator Elering. This is a strategic acquisition by the state as Võrguteenus Valdus is the owner of EG Võrguteenus, which is the only gas transmission system operator in the country.
The Estonian state now controls the national electricity and gas transmission systems, both crucial to the country’s energy stability. Other notable shareholders in Võrguteenus Valdus are Gazprompank, founded by the world's largest gas producer and exporter Gazprom to provide banking services for gas industry enterprises, and Itera Latvija, a natural gas supplier in Latvia and a daughter company of a Russian gas corporation.
Taavi Veskimägi, CEO of Elering, said that Elering’s strategic goal is to become an integrated electricity and gas transmission system operator and to operate in regulated businesses only. “Merging the activities of the electricity and gas transmission businesses will generate synergy and add value to both the customers and the shareholder,” Veskimägi added.
The divestment of the shareholding in Võrguteenus Valdus forms part of Fortum's efficiency programme aiming at disposal of non-core assets. Furthermore, Fortum's decision to sell is in line with Directive 2009/73/EC of the European Parliament and of the Council and the Estonian Natural Gas Act that require unbundling of natural gas transmission and gas sales ownership.
This transaction was preceded by last year’s separation by Eesti Gaas, the main natural gas wholesaler and retailer in Estonia, of its gas transmission network and transmission services, again in line with the unbundling requirement. Fortum, already a shareholder, then acquired an additional 33.66% stake in Eesti Gaas and Võrguteenus Valdus from E.ON Ruhrgas International in preparation for further sale of the gas transmission system to Elering. SORAINEN has been advising Eesti Gaas, E.ON Ruhrgas International and Fortum throughout the complex process.
The sale of shares in Võrguteenus Valdus by Fortum is subject to regulatory approvals and customary closing conditions. SORAINEN has advised Fortum during all phases of the transaction, including managing the data room for due diligence plus drafting and negotiating the transaction documents. The SORAINEN team, led by partner Toomas Prangli and specialist counsel Kadri Kallas, included lawyers across various practice areas; notably corporate law, led by partner Karin Madisson, and regulatory issues, led by partner Kaupo Lepasepp and associate Kaspar Endrikson.
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