The privatisation agency signed last week a final contract for selling out the heating and power plant in the country's fifth largest city of Ruse to Holding Slovenske Elektrarne (HSE). The deal will be finalised after confirmation from the supervisory board of the privatisation agency. The price for the full stake in the plant is set at EUR 85.1mn but 10% of the shares will be paid in compensation notes traded at some 40% of their face value. The actual value of the acquisition is thus reduced by 6% to some EUR 80mn. The Slovene company won the tender in December last year in competition against France ’s Dalkia International and Germany ’s E.ON. The total electricity production capacity of the coal- and gas-fired plant is 400MW but only a small part of some 54MW is effectively utilised due to environmental considerations and high operational costs dependant on imports of black coal. Most of the equipment is installed in the period of 1964 to 1971 and is incompatible with today's efficiency and environment standards.

The plant in Ruse was auctioned for the first time in April 2005. Russia 's electricity company RAO UES won the bidding at the price of EUR 120mn but withdrew its offer shortly after. The second-ranked CEZ offered EUR 24.3mn at that time while the third-ranked Italian company Enel valued the plant at just EUR 4.8mn. The tender was scrapped after the withdrawal of the Russians, as the other bids were seen as unacceptable. In the meanwhile, the privatisation agency has separated the smaller western unit for gas-fired heating supplies and has sold it to a local firm at the price of EUR 1.8mn.