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Eleon: Acquisition of Nelja Energia is monopolization of Estonian market by the state

Estonian news - eteap May 29, 2018

Baltic News Service. 29th of May, 2018

The purchase of the renewable energy company Nelja Energia by the state-owned Eesti Energia is an act of monopolization of the market by the state and the Competition Authority should not approve the consolidation, Andres Sonajalg, board member of rival wind energyproducer Eleon AS, said on Tuesday.

“This acquisition should be viewed as a longer-term process of monopolization of the market, not as a singular act,” Sonajalg told BNS.

According to Sonajalg, levers of government have been used in recent years to stifle the wind energy market and squeeze out private operators.

“Strict height restrictions have been established for wind turbines save for those in the developments of Eesti Energia, the construction of the Aidu wind farm has been hindered and attempts have been made already for a longer time to play the land area for the biggest wind farm in Estonia, the Tootsi farm, into the hands of Eesti Energia,” Sonajalg added.

The manager of Eleon said that Eleon has decided to fight for the Tootsi and Aidu wind farms to the end to emerge as the second biggest wind energyproducer in Estonia and to set up wind turbines based on Estonian technology in order to get references for export and turn the manufacture of wind turbines with high value added into a success story and a new growth engine for Estonia.

“Considering that this transaction will significantly strengthen the dominant market position of Eesti Energia, we hope that the Competition Authority will not endorse the planned consolidation,” he said.

Enefit Green AS, fully owned subsidiary of the Estonian state owned energy group Eesti Energia, and Vardar Eurus and minority shareholders signed an agreement on Tuesday regarding all the shares in Nelja Energia, a renewable energy producer and developer in the Baltic countries.

The consideration payable for 100 percent of the shares of Nelja Energia amounts to 289 million euros. In addition, the buyer assumes Nelja Energia‘s net debt which amounted to 204 million euros as at the end of 2017, Eesti Energia said in a press release.

The transaction remains subject to approval by the County Executive Board of Buskerud County Administration, and customary approvals and clearances by relevant competition authorities.

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