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The Warsaw Voice » Business » October 24, 2002
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RWE to Take Over Stoen
October 24, 2002 By A.R.    
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The agreement on the sale of a strategic stake in the Warsaw power distribution company Stoen to German corporation RWE has triggered a political crisis, leading to a disruption in the work of parliament.

Representatives of RWE Plus AG and the Polish government signed Oct. 15 an agreement on the takeover by the German company of 85 percent of Stoen, which is active in the sale, transmission and distribution of power in Warsaw. The German corporation is to pay zl.1.5 billion for a strategic stake in the Polish company, and additionally carry out an investment program worth at least zl.422 million over three years.
Stoen, which transmits 5.4 billion kilowatt-hours of power annually to more than 780,000 end users, has a share in the Polish market of around 5 percent. The agreement is conditional on decisions required under Polish law from the minister of internal affairs and administration and the Competition and Consumer Protection Office (UOKiK).

Heinz-Werner Ufer, president of RWE Plus AG, said that taking over shares in Stoen was another important step toward increasing RWE's involvement in Central and Eastern Europe. The RWE corporation, which includes RWE Plus, is the third largest energy group in Europe. In Poland, it is already a shareholder in Elektrociepłownia Będzin combined heat-and-power plant, Elbud Gdańsk and Przedsiębiorstwo Wodoci±gów i Kanalizacji water and sewerage enterprise in D±browa Górnicza.

The sale of Stoen, which is the largest privatization transaction this year, has generated much emotion in the political world (see page 7). Representatives of the opposition have demanded the annulment of the agreement and a parliamentary debate on privatization policy. Some representatives of the co-ruling Polish Peasants' Party (PSL) were also critical of the transaction. Gabriel Janowski, a deputy with the League of Polish Families (LPR), expressed his opposition in the most drastic way. He moved to occupy the Sejm podium, disrupting a parliamentary session.

The privatization of Stoen has triggered indignation among parliamentarians chiefly because, in keeping with the adopted privatization strategy for the energy sector, power generation enterprises were supposed to be first in line for privatization, and only then power distributors were to be privatized. Moreover, according to opposition deputies, the agreement on selling Stoen was signed too hastily and without a debate. Treasury Minister Wiesław Kaczmarek disagreed, saying that the transaction was carried out in keeping with the energy policy guidelines and the 2002 privatization guidelines approved by the government. Kaczmarek also said that the transaction on the sale of Stoen and other enterprises slated for privatization did not threaten the state's energy security in any way.

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