Montenegrin court freezes Italian A2A's shares in EPCG

Montenegrin court freezes Italian A2A's shares in EPCG
By Denitsa Koseva in Sofia July 19, 2017

Montenegro’s high court has blocked the shares of Italy’s A2A in power firm EPCG upon the request of the special prosecution, which is probing managers of this company, local media reported on July 19.

Earlier in July, A2A sent a put option notice to Montenegro’s government, exercising the right to sell its 41.7% stake in power company EPCG for €250mn. Now the court’s decision could delay the Italian company’s exit from EPCG.

Last year, the special prosecution launched an investigation into several managers of EPCG, in connection to consultancy contracts signed by EPCG with A2A. According to information provided by Srdjan Kovacevic, the current head of EPCG’s board of directors, the contracts have led to excessive costs for the power monopoly and were signed in violation of its procedures and of Montenegro’s laws. The contracts were worth more than €11mn.

Among those investigated are EPCG’s former financial directors, Flavio Bianco and Massimo Sala, as well as a former executive director – all of them representatives of A2A in the power firm’s management board.

There were other signs that A2A's exit from its Montenegrin investment may not go smoothly. At the end of June the special prosecution revealed it was investigating Goran Rodic - a local lawyer suspected of organising a criminal group along with top managers of A2A with the aim of instigating bribery. It added no details.

The investigation was launched following a case initiated by Montenegro’s Network for Affirmation of the NGO Sector (MANS) over EPCG’s plans to buy stakes held by A2A and Aco Djukanovic, brother of former prime minister Milo Djukanovic, in the Rudnik Uglja coal mine. The NGO has accused A2A of bribing EPCG managers to present and defend a proposal for the sale of A2A’s stake in the coal mine to EPCG.

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