Italy’s A2A has sent a put option notice to Montenegro’s government, exercising the right to sell its 41.7% stake in power company EPCG for €250mn, the Italian utility said on July 3.

A2A was expected to exit EPCG as the Italian company has an option to sell its 41.7% stake to the Montenegrin government for €250 between June and September this year, according to the contract with Montenegro’s government, which holds the controlling 57% stake in EPCG, on the management of the power firm.

At the end of June, Montenegro’s government confirmed rumours it was in talks with A2A on the details of its exit from EPCG and that the extension of the Italian company’s management contract that expired on July 3 was not an option.

A2A acquired a stake in EPCG in 2009. Since then, the Italian company has managed EPCG under an agreement with the state.

The Italian company was expected to exit EPCG mainly due to its lack of enthusiasm for the project to extend the capacity of TE Pljevlja, which now has only one unit of 210MW. The planned project has been criticised for its lack of economic viability, and the government is searching for a new investor after the Czech Export Bank pulled out. 

However, there are 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.