ArmInfo.Strategic transaction for the sale of package of shares of International Energy Corporation CJSC (IEC CJSC, Republic of Armenia) owned by RusHydro Group to the Hrazdan Energy Company, a member of the Tashir Group, has been completed.
According to the terms of the agreement concluded in December 2019 on the sale to the Tashir Group of 90% of the shares of IEC CJSC, which controls the Sevan-Hrazdan cascade of hydroelectric power stations in Armenia, the buyer fully refinanced the loan obligations of IEC CJSC, secured by the guarantee of PJSC RusHydro, to the European Bank for Reconstruction and Development and the Asian Development Bank, after which 90% of the shares of CJSC IEC were transferred to the ownership of the buyer.
As a result of the transaction, the level of RusHydro Group's financial debt decreased by 4 billion rubles, and the currency risks of the Group's loan portfolio were completely excluded. With the sale of IEC CJSC, RusHydro Group ceased to own generating assets outside the Russian Federation.
As previously reported, under the terms of the agreement, the cost of 527,085 ordinary registered uncertified shares of CJSC IEC amounted to 172.96 million rubles. The termination of participation in IEC CJSC and the conclusion of a sales contract were approved by the RusHydro Board of Directors in accordance with a directive of the Government of the Russian Federation. The transaction permit was also issued by the Public Services Regulatory Commission of the Republic of Armenia. February 19 this year the Public Services Regulatory Commission (PSRC) of the Republic of Armenia issued the International Energy Corporation (IEC) CJSC, which operates the Sevan-Hrazdan Cascade of Hydroelectric Power Plants in Armenia, permission to pledge its shares and property in HSBC and / or the Eurasian Development Bank.
RusHydro announced its intention to sell the asset as a non-core asset back in 2017 due to the large debt burden, which cannot be reduced due to low tariffs. If the IEC violates covenants or debt payment schedules, this could lead to a cross-default on RusHydro's obligations - to avoid this, the company would have to inject additional funds into the IEC. "IEC" CJSC is one of the largest electricity producers in the territory of Armenia. The installed capacity of the company's hydropower plants is 561.4 MW, or about 14% of the total installed capacity of power plants in the Republic. The company owns seven hydroelectric power plants that generate 8-10% of the country's electricity. The hydropower cascade uses the natural runoff of the Hrazdan River and irrigation water releases from Lake Sevan.
