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Latvian competition watchdog approves takeover of Nelja Energia by Estonia’s Enefit Green

International News - eteap July 11, 2018

Baltic News Service. 11th of July, 2018

The Latvian Competition Council has given a go-ahead to Enefit Green, the green energy subsidiary of the Estonian state-owned energy company Eesti Energia, to acquire 100 percent in the renewable energy company Nelja Energia, which operates in all three Baltic states.

The Latvian competition watchdog said it had approved the takeover because it would have no serious effect on the competition in the given market.

Enefit Green and Nelja Energia are both registered in Estonia but indirectly own biomass-fueled combined heat and power (CHP) plants in Latvia. Namely, Enefit Green owns Enefit Power and Heat Valka in Valka municipality in north-eastern Latvia, and Nelja Energia owns Technological Solutions in Broceni municipality in western Latvia.

“Operations of both companies in Latvia overlap only in the electric power generation and wholesale market,” said Zane Gorskova, a spokeswoman for the Competition Council, noting that the operations of the said CHP plants did not overlap as they were supplying heat to different regions.

The Competition Council concluded that Enefit Green and Nelja Energia together would hold a small share of the Latvian electric power generation and wholesale market therefore the takeover of Nelja Energia will not change the market structure, will not notably reduce competition and will not put any company in a dominant position in the market. As a result, the Latvian competition watchdog decided to approve the takeover.

As reported, in late May this year Eesti Energia announced that it planned to buy Nelja Energia for EUR 289 million and will also take over Nelja Energia‘s liabilities worth EUR 204 million. Eesti Energia will acquire 100 percent in Nelja Energia from Norway’s Vardar Eurus and other shareholders.

Enefit Green owns four wind farms with a capacity of 111 megawatts, three cogeneration plants in Estonia and Latvia, one hydroelectric power plant and one solar power plant.

Nelja Energia owns 17 wind farms in Estonia and Lithuania with total capacity of 287 megawatts. In addition, the company owns a pellet factory and combined heat and power plant in Latvia and has minority ownership in two biogas stations in Estonia.

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