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AIDE – MEMOIRE
regarding the projects of privatization and investments raising
for the economic agents under the portfolio of the Ministry of Economy
The main objective of the Ministry of Economy (ME) is to sustain the economic growth. In this
respect, there are considered the following short term main objectives and measures:
 Improving the state owned companies performances by restructuring, in order to reduce the
registered losses and to restrict the arrears;
 Implementing the corporate governance law provisions, by removing the involvement of
politics in the management of the state owned companies and by ensuring professional
management in these companies;
 Advancing the privatization process, especially where and when the privatization brings
responsibility and caution in the managing of state assets and of resources with the aim to
modernize and develop the energy sector as the main engine of economic growth and of
competitiveness;
 Improving efficiency in exploitation of coal;
 Accelerating the completion of the projects of national strategic interest in energy –
Tarniţa-Lăpuşteşti Hydro Power Plant, Cernavodă Nuclear Power Plant - Units 3 and 4, the
new power units at Rovinari, Brăila, Galaţi, etc.
In accordance with the objectives and measures provided in the Governance Program for 2013 –
2016 and following the recent discussions with the joint mission of the International Monetary
Fund, the World Bank and the European Commission, measures of structural reform of economic
operators under ME’s portfolio have been agreed to be developed the following components:
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privatization and investments raising;
restructuring the economic operators registering losses;
reforming management of the state owned enterprises.
The main objectives aimed by the Romanian state in privatization and investments raisingraising
process are the followings:
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ensure financial resources to modernize and develop the energy sector;
ensure transparency of the privatization process;
get the best price.
For privatization and investments raising, the Ministry of Economy, through the Office of State
Ownership and Privatization in Industry, intends to conduct the following privatization and
investments raising projects:
1. Sale on the capital market of minority stakes through Secondary Public Offer (sale of
existing shares) or through Initial Public Offer (sale of new shares issued by capital
increase)
1.1. Secondary Public Offers (SPOs):
Sale process of a 15% stake at the National Company for Natural Gas Transport
„TRANSGAZ” S.A. Mediaş by Secondary Public Offer:
 Transgaz S.A. is the technical operator of the national gas transmission system in
Romania and ensures transport and dispatching of natural gas networks and systems. Also
ensures international transit of natural gas on Romania’s territory and the diversification
of natural gas transport routes for the European market;
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 The strategy for sale of the stake representing 15% of the company’s share capital was
approved by the Romanian Government through the Government Decision no.
827/04.08.2010 for the approval of the privatization strategy for sale of shares issued by
the National Company for Natural Gas Transport “TRANSGAZ” S.A. Medias by capital
market methods;
 The offer is intermediated by the Underwriter consisting of Raiffeisen Capital &
Investment, Wood & Company Financial Services and BT Securities;
 Currently, there are in progress the activities for preparing the Secondary Public Offer for
selling the stake of 15% of the share capital, and further to their completion, it will be
launched the sale offer, by mid-April 2013.
Sale process of a 15% stake and admission to trading on regulated market managed by
Bucharest Stock Exchange of the National Company for Natural Gas “ROMGAZ” S.A.
Mediaş by Secondary Public Offer:
 Romgaz is a company of national interest operating in the field of production, supply and
underground storing of natural gas, which also carries out research and geological
exploration activities for discovery of new reserves of natural gas. Romgaz holds the
position of market leader and has a steady market share of about 40%;
 The privatization strategy for sale of the stake representing 15% of the company’s share
capital was approved by the Romanian Government through the Government Decision no.
831/04.08.2010 for the approval of the privatization strategy by public offer for National
Company for Natural Gas “ROMGAZ” S.A. Medias and the mandate of the involved
institution in developing this process;
 The offer is intermediated by the Underwriter consisting of Erste Group Bank AG,
Goldman Sachs International, Banca Comercială Română and Raiffeisen Capital &
Investment;
 Currently, there are in progress the activities for preparing the Secondary Public Offer,
and further to their completion, it will be launched the sale of a 15% stake of the share
capital and admission to trading of Romgaz’s shares on regulated market managed by
Bucharest Stock Exchange, by the end of October 2013.
1.2. Initial Public Offers (IPOs):
In order to generate additional investments in the energy sector, there will be launched offering
processes for the sale of minority stakes for S.C. Hidroelectrica S.A. and S.C. Nuclearelectrica
S.A. through 10% capital increase, via initial public offering (IPO), as follows:
Sale process of shares newly issued by S.C. Hidroelectrica S.A. through capital increase of
10%, via Initial Public Offer (IPO):
 Hidroelectrica is the main power producer and the main system services supplier in
Romania (80% out of the total services);
 The privatization strategy of Hidroelectrica through public offer of capital increase by
private capital participation was approved by the Romanian Government through the
Government Decision no. 38/2012 for the approval of the privatization strategy of
Hidroelectrica;
 On April 2, 2012, the consortium consisting of BRD Societe Generale, Citigroup Market
Ltd., Societe Generale and SSIF Intercapital Invest was selected as the authorised
Underwriter. Up to now, there have been performed several negotiation meetings with
the selected consortium on the intermediary documents with the view of signing the
Engagement Letter;
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 On June 20, 2012, the Bucharest High Court of Justice admitted by civil sentence, the
opening of general insolvency procedure as provided by Law no. 85/2006, as amended
and completed, against Hidroelectrica and Euro Insol S.P.R.L. has been appointed as
judicial administrator of Hidroelectrica;
 Since then, the judicial administrator undertook several measures including the
notification of the Romanian and foreign credit institutions where the company has
opened accounts, the review of the energy supply contracts, creditors and receivables
status. The insolvency procedure does not affect Hidroelectrica and National Energy
System operation;
 Under the insolvency procedure there is envisaged a significant restructuring process of
the company, improvement of the revenues, optimizing the expenses and increase of the
efficiency, thus resulting a restructured and efficient company, much more attractive for
the private management and for the envisaged stake to be sold to the private investors;
 The listing procedures of Hidroelectrica will be resumed after the company will get out of
insolvency procedure and after the evaluation of reorganization outputs, under the
conditions of the existing legal framework at that time.
Sale process of the shares newly issued by National Company Nuclearelectrica SA through
capital increase of 10% via initial public offer (IPO):
 Nuclearelectrica is the second power producer in Romania, generating electricity and
thermal power by nuclear technology and assuring approx. 20% from the total power
generation in Romania ;
 The privatization strategy of Nuclearelectrica through public offer of capital increase by
private capital participation was approved by the Government Decision no. 39/2012 for
the approval of the privatization strategy of Nuclearelectrica;
 The offer is intermediated by the Underwriter consisting of Swiss Capital and BT
Securities;
 After the conclusion of the Agreement between Nuclearelectrica and the selected
Underwriter (by mid-February 2013), there will be developed the activities for preparing
the Initial Public Offer, and further to their completion, it will be launched the sale of a
10% stake of the increased share capital and admission for trading of Nuclearelectrica’s
shares on regulated market managed by Bucharest Stock Exchange, by the end of May
2013.
Sale process of the shares newly issued by S.C. Complexul Energetic Oltenia S.A. through
capital increase of 15% via initial public offer (IPO):

By the Government Decision no. 1024/2011 it was approved the setting up of the Energetic
Complex OLTENIA by merging SN a Lignitului Oltenia and the three energy complexes in
Craiova, Rovinari and Turceni;
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It is initiated and will be submitted for Government approval the privatization strategy sale
process of the shares newly issued by S.C. Complexul Energetic Oltenia S.A. through capital
increase of 15% via initial public offer (IPO). The next stage consists in the selection of the
Underwriter to assist the company and ME in the minority privatization process, by April
2013.
The amounts resulted from the IPOs of the two companies will be cashed in by the
companies and used in different investment programs.
The major objective envisaged by all these privatizations is to maximize the revenues resulting
from the sale of the shares via public offering and to attract investments in the companies acting in
energy field.
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These privatizations also envisage other important objectives such as:
 ensuring financial resources from potential investors from the country and abroad by dual
listing at the Bucharest Stock Exchange and in other important financial centres of Europe;
 strengthening the Romanian capital market, revival thereof, as well as raising private
financial resources from potential investors through the specific mechanisms of the capital
market;
 encouraging the issuers to finance themselves through the capital market and further on
continue the dialogue with the representatives of the trading companies or with the local
public administration authorities to promote these measures;
 increasing the revenues to the state budget, generated by growing the activity on the
Romanian capital market.
According to the provisions of the Underwriting Agreements concluded for these public
offerings, during the preparing of the sale offers, the selected underwriters will provide their
proposals regarding the optimum momentum to launch the public sale offerings, based on
analysis of domestic and international capital market, of the national and international
economic environment.
Trading these companies on the stock exchange, will ensure the private investors be part in the
decision taking process of the management of these state owned companies, thus improving
significantly the operational efficiency of these energy companies, by motivating the minority
investors, ensuring transparency of decision-making and giving confidence to investors.
2. Privatization through sale of majority stakes
S.C. Complexul Energetic Hunedoara S.A.:
 By the Government Decision no. 1023/2011 it was approved the setting up of the Energy
Complex Hunedoara by merging S.C. Electrocentrale Paroşeni S.A. and S.C. Electrocentrale
Deva S.A.;
 It is initiated and will be submitted for Government approval the majority privatisation
strategy consisting in the sale process of the shares newly issued by S.C. Complexul Energetic
Hunedoara S.A. through capital increase of 104% via initial public offer (IPO). The next stage
consists in the selection of the legal consultant to assist the company and ME in selection of
the transaction consultant, by end of March 2013.
 After the merger of CE Hunedoara with the new entity created on the structure of the viable
mines of CN a Huilei (National Company of Hard Coal), there will be initiated the necessary
actions in order to launch the privatisation of the majority stake of the company during 2013.
S.C. Electrica S.A.:
 S.C. Electrica S.A. coordinates the distribution activity as natural monopoly in three
geographical areas of Romania, as well as the energy supply which is developed on a
competitive and regulated market, ensuring quality services for about 3.5 millions customers.
Thus, in 2010, Electrica owned a market share, together with its subsidiaries, of about 26%
which decreased in 2011 to 25%. There has been initiated and will be submitted for
Government approval the majority privatisation strategy consisting in the sale of the shares
newly issued by S.C. DFEE Electrica S.A. through capital increase of 105% by initial public
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offer (IPO). The next stage consists in the selection of the legal consultant to assist the
company and ME in selection of the transaction consultant.
3. Other projects
S.C. OLTCHIM S.A.

OLTCHIM operates in the chemical and petrochemical industry, being an important player on
the international market of the chemical products;
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There have been initiated actions for financial restructuring, for production relaunch through
integration of Arpechim Piteşti petrochemical activities, and also measures for financing
working capital in order to improve the company's business;
 In order to increase the efficiency of the company and to speed up the privatisation of Oltchim
S.A., OPSPI started the special administration and financial supervising procedure in July
2012.
 Privatisation procedures initiated in September 2012 were subsequently revoked for failure of
the winning bidder to comply with OPSPI's requirements.
 On January 30, 2013, the Valcea High Court of Justice admitted by civil sentence, the opening
of general insolvency procedure as provided by Law no. 85/2006, as amended and completed,
against Oltchim S.A.: the consortium formed by Rominsolv and BDO Business Restructuring
has been appointed as judicial administrator of Oltchim.
S.C. CUPRUMIN S.A.
 The privatisation procedure of CupruMin S.A., finalised in early 2012, was subsequently
revoked by the Romanian Government when the highest bidder, Roman Copper Corp Canada,
refused to comply with certain terms requested by OPSPI.
 Currently, solutions are being searched in order to ensure the viability of the company’s
activity.
4. Raising investments through partnerships / joint ventures
Raising investments through partnerships/joint ventures is intended for the following economic
operators in ME portfolio:
 NUCLEARELECTRICA: completing the nuclear units 3 and 4 of 720 MW each, from
CNE Cernavodă;
 HIDROELECTRICA: Tarniţa-Lăpuşteşti hydro-power plant with an installed power of
1,000 MW;
 S.C. UZINA TERMOELECTRICA MIDIA S.A.: a new unit of 50-150 MW project by
setting up of a joint venture of IPP (Independent Power Producer) type;
 COMPLEXUL ENERGETIC OLTENIA :
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a new unit of 500 MW project by setting up of a joint venture of IPP type at
Rovinari;
-
a new unit of 500 MW project by setting up of a joint venture of IPP type at
Craiova.
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 S.C. TERMOELECTRICA S.A. – CET BRĂILA - new unit of 400 MW;
 S.C. ELECTROCENTRALE BUCUREŞTI S.A.
- CET Progresu Bucureşti – new unit of 200 MW;
- CET Fântânele – new unit of 250 MW;
 S.C. ELECTROCENTRALE GALAŢI S.A. - a new unit of 30 MW project by setting up
of a joint venture of IPP type;
 S.C. ELECTROCENTRALE DEVA S.A. -
a new unit of 660 MW project by setting up of a joint venture of IPP type;
-
joint venture for energy production by development of the hydropower potential of
storage dam on Mures river through the installation of small hydropower plants.
By carrying out the privatisation and investment raising projects for the economic operators under
the Ministry of Economy portfolio, it is aimed to modernize and develop the Romanian economy,
to improve the energy efficiency, safety in exploitation, energy security, to meet the energy needs
both for the present and for medium and long term, at a minimum price, suitable for a modern
market economy and a high standard of life, in terms of quality, security of supply, by observing
the principles of sustainable development, all this leading to economic growth and
competitiveness.
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