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A Hungarian bid for a major energy provider in Romania is under review after suspicions arose about the motives behind the inflated offer, including fears of Russian influence, according to the Romanian energy minister.
Hungary’s state-owned energy group MVM has recently outbid other companies interested in purchasing the Romanian gas and electricity distribution network owned by Germany’s Eon.
Energy minister Sebastian Burduja told the Financial Times that the takeover could be blocked on security grounds, in a move similar to Spain’s last year, when Madrid stopped a railway merger with a Hungarian company partly because of its ties to Russia.
“We have seen precedent in Spain where a transaction involving the Hungarian entity was rejected by a similar committee to the Romanian one,” Burduja said. “We will have to consider all of that then to reach a decision.”
Eon Energie România serves millions of Romanian customers with electricity and gas, with a market share that is close to 50 per cent, he said.
MVM is Hungary’s second-largest company by revenue and has been the main importer of Russian gas to Hungary. It is also operating a Russian-designed nuclear power plant in Hungary, which is being expanded under the aegis of Rosatom, Moscow’s state nuclear giant.
The Hungarian company offered to pay as much as €200mn for the majority stake in Eon Energie, which Burduja estimated to be worth no more than €50mn. The offer was far larger than what competitors, which included two state owned Romanian energy companies, were willing to pay.
Burduja said intelligence services would feed into the risk assessment of MVM taking over Eon Energie.
“The value of the transaction will be under scrutiny . . . and potential implications in the energy market,” he said. “[We will] investigate further, probably also asking for a viewpoint from the national security establishment.”
“We will not allow Russian gas to enter the country,” Burduja said, adding that the country was working to exploit its own natural gas resources and buy additional supplies on the spot market.
Romania is particularly sensitive to any Russian influence given its proximity to the Ukraine war and after it annulled a presidential election because of alleged Russian meddling.
Hungarian Prime Minister Viktor Orbán has repeatedly criticised the EU’s sanctions on the Russian energy sector, saying the west was “shooting itself in the foot” by rejecting cheap gas and meeting President Vladimir Putin last summer, prompting a backlash from fellow European leaders.
Orbán in December told the Financial Times after discussing the MVM deal with Romanian Prime Minister Marcel Ciolacu that there were “outstanding issues” still to be ironed out.
“The Romanian premier raised these and asked . . . to set up a joint task force to calm everyone and make everything transparent,” Orbán said, leaving unanswered further questions about Russian involvement in the deal.
MVM said it would co-operate with Romanian authorities, but declined to discuss details of what it said was an ongoing transaction. It said its regional gas procurement portfolio was diverse both in terms of sources, routes and maturity.
Russian gas supplied by state-owned Gazprom “constitutes only 40 per cent of the total regional trade portfolio”, the company said. It receives the Russian gas through a pipeline crossing Turkey, the last remaining route to Europe after a transit deal between Gazprom and Ukraine ended on January 1.
Eon did not immediately reply to a request for comment.
